I am currently studying Cert 4 in Accounting and Bookkeeping, with BAS, what should be the treatment for deposits paid/ received in advance when the company is using the Accrual method? Any link for the information? Thank you.
Hi @JTayag,
If the business accounts on an accruals basis, the income is reported in the period in which a tax invoice was issued, or full/part payment was received, whichever occurs first. So for your question, if no invoice has been provided but a deposit has been paid, the income will be reported in the period the deposit was made. If an invoice was provided prior to deposit, then it will be reported when the invoice was provided. Our page on GST explains this accounting method further (That explanation is available on there too).
Hope this helps, let us know if you have any questions.
Hi @JTayag,
If the business accounts on an accruals basis, the income is reported in the period in which a tax invoice was issued, or full/part payment was received, whichever occurs first. So for your question, if no invoice has been provided but a deposit has been paid, the income will be reported in the period the deposit was made. If an invoice was provided prior to deposit, then it will be reported when the invoice was provided. Our page on GST explains this accounting method further (That explanation is available on there too).
Hope this helps, let us know if you have any questions.
6,896 views
2 replies