Prepaid Income and Expenses
by Soccer League
We are a community league, we do registrations for Outdoor soccer in March and recieve money. We also send a cheque for registrations in March as well. Our year end is April 30.
How do I record these two transactions properly so they can be put in for the next fiscal year, and so the proper income/ expenses for the soccer program?
To properly allocate your income and expenses to the coming year, you need to set up two balance sheet accounts.
The first account should be a current asset called Prepaid Expenses
. You can read about prepaid expenses
and how to record the entries in my article on Home Business Taxes.
The second account you need to set up is a current liability account called Advanced Deposits
. You can find out more about advanced deposits
in my article on Common Bookkeeping Entries
I wish you much success in the upcoming soccer year. Go team go!