Hi,
I sell a service to my clients who pay for the month in advance. I then pay for the service provided for the month in advance, but on a separate date.
When do I record these transactions to the income and expense accounts?
For example, a client pays me £10 on 15/01/2020 for the month 15/02/2020 to 14/02/2020. I then pay the supplier £5 for the service for the month 05/02/2020 to 04/03/2020 on 05/02/2020.
Should I record this to the income and expense accounts on 15/01/2020 or 14/02/2020? Is it worth accruing this or should I just record them when the transactions happen, seeing as I am not responsible for providing the service?
Many thanks,
Ewan
Replies (1)
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I am not responsible for providing the service?
Your client may disagree, seeing as they have a contract with you, not your subcontractor...