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Post Info TOPIC: Problem balancing a SOFP
GCW


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Problem balancing a SOFP
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Good evening all. My first post here. I am having trouble trying to balance the Statement of Financial Position for a Limited company owned by a close friend, for whom I am the bookkeeper.

I suspect that the answer is staring me in the face, but would appreciate some help if possible?

I think the issue is related to VAT:

In terms of turnover, the company issued a sales invoice just before year end, which was paid in the new financial year. For rounding purposes, this invoice was £10k plus £2k VAT = £12k gross.

I have included the £10k within my turnover figures on the SOCI. I have also listed £10k as a debtor within current assets, to reflect that this invoice was owed to the company at the year end.

Now, when I did the VAT return for the quarter (which coincided with the year end) I included the £2k of VAT from the invoice referenced earlier as output VAT. The VAT return showed a value due to HMRC of £2,500. I have listed that as a creditor on the SOFP (the company paid this just after the year end).

Have I posted those transactions correctly? Should my debtors value be £12k instead of £10K?



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Casu


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Do your double entry and it will become obvious

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Caron
GCW


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Yes - I went back to the old fashioned T accounts and managed to get the answer, which I knew had been staring me in the face all along. Thank you.

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