How to reverse the provisions of expenses made in last year which was not paid or half paid?
If provisions are passed through Journal Entry then the entry will be(Payment is not made) -
| Debit | Credit |
| Provision for expense A/c | Expense A/c |
To Pass Journal entry, login to Admin Dashboard>>>General Ledger>>Journal Entries.
If provisions is passed through Journal Entry then entry will be(Half payment is done) -
Suppose you had created Rs. 10000 electricity provision in last year but actually the got arrived for Rs. 9500 only. In this case entry will be :
Provision for expense A/c Dr 10000
To Expense A/c (Provision not paid). 9500
To Bank & cash A/c (Paid amount). 500
If provisions is passed through Expense Tracker >> By Vendors >> Bulk posting >> Upload Opening Balances then entry will be -
Suppose you had created Rs. 10000 electricity provision in last year but actually the got arrived for Rs. 90000 only. In this case.
a. Pass payment entry for Rs. 9500 and
b. For Rs. 500 pass write off entry with the comment saying reversal of last years provision.
Note : This is only a suggestion.For Audit related Accounting clarifications, please consult your auditor.
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