Accruals, prepayments and payroll
You will be able to: Explain accruals and prepayments and why month-end needs them; Post an accrual with Expense Entry or a Journal Voucher and reverse it; Set up an amortization schedule and post due amortizations.
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Accounting should match costs and income to the month they belong to, not the month the cash moved. An accrual is a cost that belongs to this month although the bill has not been entered. A prepayment is a cost you paid ahead that belongs to later months. Deferred income is the mirror image: money received ahead for service you will deliver later.
Accruals
- Expense Entry (Accounting, Expenses, + New): set Payment to Accrued Expense. Zeyto credits the Accrued Expenses account instead of cash or Trade Payables.
- Journal Voucher (Accounting, Journals): debit the expense, credit Accrued Expenses, dated the last day of the month, with a Narration (required). Debits must equal credits. A posted journal is never edited in place: Amend or Cancel reverse it.
Zeyto's help describes no automatic reversal of an accrual. The usual manual method is to post a second journal dated the first day of next month that does the opposite, then enter the real bill normally. Otherwise the cost is counted twice. This is a bookkeeping convention, not a Zeyto feature.
Payroll
In Employees, Payroll Run, Calculate posts nothing. Approve Payroll posts a journal debiting Salaries & Wages (6100) for gross pay and crediting Salaries Payable (2500) for net pay and Employee Advances (1460) for any advance recovery. Pay Payroll posts a second journal debiting Salaries Payable and crediting the bank.
Amortization schedules
Accounting, Amortization Schedules spread one amount over months. Prepaid Expense is a cost paid in advance, debited to a P&L account each month and credited from a balance sheet account. Deferred Income is the reverse. Creating a schedule posts nothing and does not record the original payment, which is a separate entry that puts the amount on the balance sheet account.
- The form starts with example values. In the standard chart, ledger 1450 is Supplier Advances, not a prepaid ledger, so choose both ledgers yourself.
- Press Create Schedule once. The screen shows no message and a second press makes a second schedule.
- A schedule cannot be edited. To change it, cancel it (optionally reversing posted periods) and create a new one.
- If a period cannot post, for example because no open fiscal year covers it, the run stops there and earlier periods stay posted.
Try it in the demo
- Open Accounting, Expenses and press + New. Open the Payment list and find Accrued Expense. Do not save.
- Open Accounting, Amortization Schedules and read the three tiles and the Status column.
- Open Accounting, Post Due Amortizations and set As of to the last day of last month. How many periods are due?
- Open Employees, Payroll Run and read the status line. Do not calculate or approve.
Public demo company, sign in as admin / demoAdmin123. Data refreshes nightly.
- An accrual books a cost in the month it belongs to; Zeyto has no automatic reversal, so you reverse it by journal.
- Payroll journals take the date you press Approve or Pay.
- An amortization schedule posts nothing until you run Post Due Amortizations as of the month end.
- A prepaid schedule debits expense and credits the balance sheet account; deferred income does the opposite.
Check yourself
5 questions on this lesson. Not timed, not the exam, and you can try again. Score 60% or more, and read the lesson, to complete it.
1. Zeyto automatically reverses an accrual journal on the first day of the next month.
2. A cost you paid in advance that belongs to later months is called a:
3. A prepaid expense schedule of AED 36,000 over 12 months starts in October. What does Post Due Amortizations post as of 31 October?
4. Which statements about Amortization Schedules are true?
Select all that apply.