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I am going out of the 2022 with $300,000 in prepaid fertilizer and the expense for 2022. Using A- as the start of the transaction for 2023, how do I get prepaid asset down to 0? The expense was already used in 2022. Can't get the transaction to balance. I've looked at the examples, but they use the same year for the transaction. This prepayment/receiving product is for 2 different years. We will be doing this every year, buying next years fertilizer at year end.
Hi Terry! Apologies for not seeing this until now. With Cash reporting, the expense will show up in the fiscal year of whenever the expense is actually paid. So if you do a Withdrawal and an Expense line, the expense will appear in reporting for the date of the Withdrawal. If you create the transaction with a Payable Charge, the expense will not show until the payment is applied with a later Withdrawal transaction that has a Payable Payment line to clear the previous invoice. You can use the Prepaid Items account to show that an asset has been purchased but not used as an expense. You would first do a Withdrawal transaction and an Asset Purchase to Prepaid Items. The second transaction would be for when you want the expense to appear in report and would be a Withdrawal for $0 and an Asset Sale to Prepaid Items for the expense amount followed by a second line of Expense. This pair of transactions allows you to have the money come out of your bank account but not claim the expense until the date of the second transaction.
Hope that helps!