ABC company receives rent for subletting part of its office block.
Rent, receivable quarterly in advance, is received as follows:
| Date of receipt | Period covered | $ |
| 1 October 20X3 | 3 months to 31 December 20X3 | 15,000 |
| 30 December 20X3 | 3 months to 31 March 20X4 | 15,000 |
| 4 April 20X4 | 3 months to 30 June 20X4 | 18,000 |
| 1 July 20X4 | 3 months to 30 September 20X4 | 18,000 |
| 1 October 20X4 | 3 months to 31 December 20X4 | 18,000 |
What figures, based on these receipts, should appear in the company’s financial statements for the year ended 30 November 20X4 ?
Answer
| Receipt | $ | |
| 1 October 20X3 (15,000 x 1/3) | 5,000 | |
| 30 December 20X3 | 15,000 | |
| 4 April 20X4 | 18,000 | |
| 1 July 20X4 | 18,000 | |
| 1 October 20X4 (18,000 x 2/3) | 12,000 | (6,000 Credit rent in advance) |
| Credit to statement of profit or loss | 68,000 |
Statement of profit or loss
$68,000 Credit
Statement of financial position
Rent received in advance (Cr) $6,000