Show the treatment of prepaid expenses depreciation, closing stock at the time of preparation of final accounts when:
(a) When given inside the trial balance?
(b) When given outside the trial balance?

Explanation

Treatment of paid expenses, depreciation and shutting stock at the time of getting ready the ultimate account :

(a) once Given within the balance Prepaid Expenses once paid expenses square measure given within the balance itself it'll be treated as current assets solely and can be announce within the Assets aspect of the record. No any adjustment are needed during this case
Depreciation once depreciation is given within the balance it'll be treated as associate expenditure and can be shown within the accounting system of the Profit and Loss Account. No any adjustment are needed during this case. Closing Stock once closing stock is given within the balance it'll strictly be treated as assets and can be shown solely within the Assets aspect of the record. No any adjustment are needed during this case.

(b) once Given Outside the balance Prepaid Expenses once paid expenses square measure given outside the balance it'll be treated as associate Adjustment and can be announce at 2 places 1st of all it'll be subtracted from the involved expenses within the {debit aspect accounting system| method of accounting} of Profit and Loss Account and then it'll be treated as current assets and can be announce within the Assets side of the record.
Depreciation once depreciation is given outside the balance it'll be treated as associate adjustment and can be announce at 2 places to adjust to the principles of clerking book keeping system.
1st of all quantity the quantity the number} of depreciation are shown within the {debit aspect accounting system| method of accounting} of Profit associated Loss account as an expenditure and therefore the amount of depreciation are subtracted from the involved assets within the assets side of record.

Closing Stock once closing stock is given outside the balance it'll strictly be treated as associate adjustment and can be announce at 2 places 1st of all the quantity of closing stock are shown at the {credit aspect accounting system method of accounting} of mercantilism Account associated then it'll be shown as an assets within the Assets side of the record.