What Are Postpaid Expenses
The word Prepaid mea n s to pay after receivi n g some b e nefits. So, Postpaid Expe nses are those Expenses for which the Sole Proprietor’s B usiness or the company enjoyed the benefits but the payment is payable at the end of the accounting period. It is a Current Liability for the business and shown on B alance Sheet as it is payable at the end of the accounting period for which the business has already received the benefits for that period. For Example, if the user compa ny after receiving internet usage data and then pay to internet service company at the end of the accounting, then it is an example of postpaid expenses. Postpaid Expenses Journal E ntry is the same as in case of Accrued Expenses or Outstanding Expenses or Expenses Payable . When the company incurs the expenses, then the following Adjusting Entry is recorded as shown below: ...