The following transactions relate to Rashid's electricity expenses ledger account for the year ended 30 June 20X9.
| Prepayment brought forward | 120 |
| Cash Paid | 2,800 |
| Accrual carried forward | 3,920 |
What amount should be charged to the income statement in the year ended 30 June 20X9 for electricity?
Suggested solutions
Prepayment Account
| Prepayment brought forward | 120 | To electricity account | 120 |
Electricity Account
| Cash Paid | 2,800 |
| From prepayment account | 120 |
| To accrual account | 3,920 |
| Total Electricity | 6,840 |
Accrual Account
| - | - | From electricity account -accrual | 3,920 |
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