Accruals and prepayments: how do I know which way round the adjustment goes?
Stop trying to remember which is which. Work it out from one question, every time: has the expense been used up, and has it been paid for? Those two things come…
Worked answers
Accounting questions, worked through
A subject with unusually little ambiguity: the double-entry system either balances or it does not. That makes it very learnable and very unforgiving: one misposting early in a question can cost every mark that follows.
- 1 worked answers
- 1 topics
Adjustments and the accounting equation
Where Accounting marks actually go
These answers are written around the failure modes below rather than around the topic list. That is deliberate: most students who are stuck in this subject know more content than their grade suggests, and lose marks to one of these instead.
- Double entry half-understood, so debits and credits are applied by memory rather than by reasoning
- One early error cascading through a full set of financial statements and taking every subsequent mark with it
- Adjustments (accruals, prepayments, depreciation, provisions for doubtful debts) learned as separate tricks
- Ratio analysis calculated correctly and then interpreted in one thin sentence where the marks are in the evaluation
More on how we teach Accounting, or browse questions in other subjects.
Who these are written for
Students heading for accountancy, finance or business degrees, and anyone who finds the logic satisfying. It rewards precision and routine practice more reliably than almost any other subject at this level.
How to get something out of a worked answer
Reading one of these is worth very little on its own, which is true of any explanation and is the reason revision by rereading feels productive and mostly is not. The method that works is slightly uncomfortable and takes about ten minutes per question.
Read the question, close the page, and attempt it on paper. Get it wrong if that is what happens: being wrong and then finding out why is the part that sticks. Then read the worked answer and, rather than checking whether your final answer matched, find the exact step where your version diverged from ours. That step is the thing to practise, and it is usually one specific decision rather than a whole topic.
Then find two similar questions from your own materials and do them cold. If the same step goes wrong again, you have found a genuine gap. If it does not, you have just fixed something. The wider method is here.
Why we publish these at all
Because we do not publish reviews or testimonials, and a parent choosing a tutor needs something to judge. Review widgets are cheap and star ratings are unfalsifiable, so we would rather hand you the actual teaching and let you decide whether it is any good. If these explanations are clear, that is the most honest sample of what you would be paying for that we can give you. More on that policy here.