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Stardoe


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Deferred income.....again!
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Hi guys,

I submitted a post about deferred income a little while ago:-

http://www.book-keepers.org.uk/t41673623/deferred-income/

and now have a similar situation coming up to the end of my client's financial year this year in August.

This is slightly different though in that she has invoiced six students for courses that are due to start in September and dated the invoices 21st June 2011.  This time she has only received deposits for the courses, not the total amount in full.  Each invoice is for just over £2000 and the deposits for £150  - £200.  Can I defer the income for the full courses to next year or does it have to be just the deposits, seeing as she has only received the deposits in actual income?  Struggling to get my head round it!

Limited Company, Cash accounting for VAT if they are relevant?

Many thanks for any help!

Pauline



-- Edited by Stardoe on Thursday 30th of June 2011 08:19:02 PM

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Pauline
MarkS


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Hi Pauline

Basically wouldnt include any of the income ie defer invoices/deposits if relates to next financial year.

Would however account for the VAT when the cash is received if on cash basis.

Regards

MarkS



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Mark Stewart CA

http://stewartaccounting.co.uk/

Providing accounting, bookkeeping, payroll and tax services to small and medium sized businesses across Central Scotland and beyond.
Stardoe


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Hi Mark,

Many thanks for replying.

So I could just journal out the net total of the invoices to deferred income as a current liability on the balance sheet?

Because my client is on cash accounting for VAT the VAT on the amounts already paid will have been accounted for already. I just get confused sometimes between income as actual money paid and income as invoiced (if you see what I mean)...lol

Just having another one of those dim moments! (Or do they call them senior moments?)

Pauline



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Pauline
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