The year end is 30/09/X0
Paid for rates on 01/08/X0 for the period from 01/08/X0 to 31/12/X0 of £600. What is the closing adjustment to reflect this information at the year end?

Question

Quizplus · Accepted Answer

The payment covers a period of 5 months (August to December), but at the year-end (30/09/X0), only 2 months (August and September) have passed. This means 3 months (October to December) are prepaid, hence a prepayment of 3/5 of £600 is correct.

The Year End Is 30/09/X0