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    DirtyRay's Avatar
    DirtyRay Posts: 8, Reputation: 1
    New Member
    		  
    #1

    Apr 12, 2007, 04:31 PM
    Would Association Subscription be an expense?
    As it says in the title, the business I'm studying has joined an Association.. would this come under as an expense in the P&L?

    Also I'm having some problems with it as a prepayment...

    We've been told that cost of member ship per month is £2000, and that one 20 Feb a payment of £24,000 for 1 years membership had been made...

    At the moment in the T-Accounts, I've got a Prepayments Account, the Association account... Basically I've Debited the Association account by 2000 (and credited the bank by 2000), Debited the Prepayments account by 22000 (and credited bank by 22000)...

    Is this correct?

    Many thanks.
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
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    #2

    Apr 12, 2007, 06:33 PM
    When does this membership start March 1?

    If so, debit prepaid for the full 24,000 and expense it once you use it up, not before.

    And yes, the association fees would be an expense on the P&L statement
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