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Hi all
I have spent hours trying to get me head around this and simply cant!
On page 533, Workbook activity 2 as for you to calculate the total membership fees (for Toptown Table Tennis Club) to be shown as income in the I & E account and how the fees paid in advance would show on the Balance Sheet.
Following all previous examples and as many from the internet as I can find I understand that Prepaid membership fees show on the Balance sheet as a credit as they are a liability, hence opening Prepaid income is a Credit and Opening accrued income is consequently a Debit.
If this is true then why in the answer on page 602 do they have the closing accrual balance on the debit side? Surely this should be a credit so that it transfers to the BS as a debit?
Likewise in the Revision Manual on page 74 (Simontown Youth Club) the trial balance has the closing accrual as a credit.
Please can somebody explain what on earth is going on here as I cant see any logic to it.
I would really appreciate someones help as I feel like I am going mad
Thanks
Kate
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