I still hate prepayments but i will try and explain to you:-
BUSINESS IS VAT REGISTERD AND FINANCIAL YEAR ENDS ON 30TH SEPT.
The companyt pay for a software license for a year at a time, last paid for some on 31st December at a net cost of £2700. The balance on this account is currently showing £5380 - what will be the cost of the software licence that will be charged to the profit and loss account for the year.
take Balance on account of £5380 less paid to date of £2700 leaves £2680
take the £2700 and divide by 12 (as for a year) = £225 month
we have paid 9 months in financial year Jan - Sept = £225 x 9 = £2025
£2025 plus the balance above of £2680 = £4705
hope this is of some help but feel free to contact me - email@example.com
good luck x