Being new to accruals/prepayments I tend to get a tad confused, so please excuse the basic question.
I use Sage and when I did the VAT period ending January 2011 I forgot to reconcile the VAT, so consequently when I did reconcile it, the VAT due was different to the submitted return insofar as we had overpaid by £375.
Our year end is March 2011 so the overpayment hasn't been rectified at ye but needs to be accounted for as the next VAT return will have the manual adjustment. Would the Year End journal be Cr VAT and Dr Prepayments?
Also, there was a mistake on wages where an employee was paid her gross salary in March, so wasn't deducted tax, NI or a cash advance that she'd had. As it was our mistake we will be taking it back from her over two months. I can't get my head round the Drs and Crs for this one at all!! The salary journal and HMRC payment is all correct, it's the net wages payment that isn't.
Would the YE Journal be Dr Net Wages and Cr Accruals for the overpaid tax and NI and Dr Net wages and Cr accruals for the cash advance?
