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Message: <blockquote data-quote="Tom Riddle" data-source="post: 10715576" data-attributes="member: 47610"><p><span style="font-size: 15px"><span style="color: Blue">Revenue is NOT related to the amount of CASH received. It is related to the amount of money that should have been received relating to this period. (</span></span></p><p><span style="font-size: 15px"><span style="color: Blue">Accruals Concept)</span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">At the beginning of the period (30/06/2008), Ace has 400 (20*20) beginner course advanced payments and 300 (30*10) advanced course advanced payments. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">Since these are for 20 and 10 lessons each, they fall within the time frame of the financial year, and should be taken as revenue for that year. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">The CASH received THIS YEAR is 25650. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue">The actual CASH for the ADVANCED payments would have been RECEIVED in the PREVIOUS year. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">However, the revenue relates to this year (the students will be having the lessons this year), therefore, we should ADD this amount to the cash received this year when calculating the revenue for this year. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">The advanced payments that are existing at the end of the year relate to the following year (the students will be provided the services the following year). Therefore they don't relate to this year. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue">However, we would have received CASH for the services that we would be supplying the following year. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue">Since this is not relevant for this year, we have to DEDUCT this amount from the cash received to get at the revenue for this year. </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">Therefore</span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">Revenue for this year = </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">Cash received this year (25650) + </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">advanced payments at beginning of year (400*5 + 300*7.5) - </span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">advanced payments at end of year (500*5 + 250*7.5)</span></span></p><p><span style="font-size: 15px"><span style="color: Blue"></span></span></p><p><span style="font-size: 15px"><span style="color: Blue">=  25525</span></span></p></blockquote><p></p>

Verification: Haya warak paha keeyada? (haya wadi kireema paha)

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