Not all receipts can be attributd to future income. There are differences between, for example, estimate income and DBP. Let’s compare two similar situations.
1) The company signd a contract for a long-term project, which expects regular receipt of money from the client during the year to implement the adopted program.
2) A company renting out office space enterd into
A long-term lease agreement with a tenant and botim database receive payment for 12 months at once.
What income is relatd to the future period? Answer: only the second point.
In the first case, such money is not considere income. The company did not receive it. It cannot be usd for settlements. Although probable, these are expectations. And the documents confirm this. Therefore, these amounts cannot be taken into account either as income or as additional expenses.
Now let’s briefly list what kind of receipts can be attributd to the DBP. All income that will be received in future periods is defind in various regulatory documents.
Rules for accounting of future income
In the framework of accounting, future period income is improvements and repairs reflected using a special account. Thus, their recording will be as transparent as possible and will comply with the requirements of all standards and accounting documentation. Accounting account 98 “Future Period Income” is use for these purposes.
It records all the funds that have arrivd in advance and relate to future reporting periods. The system is simple. Funds are receivd there from the “settlement account”, and after that, when future periods come, the accounting department distributes them in other directions.
The most frequently used sub-accounts are the first and anhui mobile phone number list second. When the reporting period begins or the organization’s obligations are fulfilled, the process of income recognition begins. Amounts from this account are gradually transferrd to the current period income within the year.
This rdistribution occurs in parts in accordance
The scheule of services or work. The write-off date cannot be movd. If the rent is paid for a year in advance, then each month only one twelfth of the amount will be transferrd from account 98 to the current income account.