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Monthly income recording...

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  • 04-04-2023 9:44am
    #1
    Tara4
    Registered Users Posts: 55 ✭✭


    I run a small business and do my own books. I have a question which might seem kinda obvious, but i thought i'd ask anyway.

    Do i record this month's revenue when i send the invoices or when i get paid from the invoices?

    Eg. I bill a client for 500 Euros on 31st March for work done in March. Should i record this amount in March revenue figures? Or should i record it when i receive it?

    I understand that the correct answer is probably when i receive the payment. However, recording it for March gives me a better idea of my income vs expenditure for that month, no?

    Thanks,

    Tagged:


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    #2
    Beau
    Registered Users Posts: 1,094 ✭✭✭Beau


    Record income for the period it was earned, not when it was paid. So yes, in your example that revenue should be recorded in March along with it's associated costs, regardless if it has been invoiced or paid to your suppliers. Hi



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    #3
    Citrus_8
    Registered Users Posts: 1,161 ✭✭✭Citrus_8


    Exactly. Accruals principal.



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    #4
    CWMMC
    Registered Users Posts: 131 ✭✭CWMMC


    You record the income from when the invoice is created. So in the example you will put the invoice in March, and if its not paid it will be in the balance sheet as a Debtor at the period so its recorded as money in and money owed.



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