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userahmedbuhassan56
Level 2

How to record startup costs incurred before start of financial year, which dates should be recorded?

Hi all,

 

Our first fianancial year starts from 01-Jan-2021 and some expenses has incurred prior to that date. How would we record these expenses, is it correct to date them as date they incurred although its prior to financial year and prior to business operations?

2 Comments 2
asha_kanta_sharma
Level 6

How to record startup costs incurred before start of financial year, which dates should be recorded?

these can be booked at the current dates and all the necessary disclosures should be given as per local laws and accounting records.

Thanks
Tehntater
Level 1

How to record startup costs incurred before start of financial year, which dates should be recorded?

so, if I have 200 dollars spent before the company was incorporated I would debit an expense account on the day the expense was incurred eg: I spent $200 on April 3rd, but, the incorporation date was June 1st, I would debit vehicle expense on April 3rd?