Advertisment for 3 years hidden adjustment
Answers
Yes their is a hidden adjustment in the following question of yours.
Always remember that questions having an info in bracket or having a "%" beside it have hidden adjustment.
To answer ur query Lets consider we are making a Final accounts
*We make final accounts for an accounting year which starts from 1st April 2009 to 31st March 2010.
*An Advertisement for 2 years mean it starts from 1st Jan 2010 and ends on 31st December 2012.
*Since for the year 2010 we have only 3 months left ,we will show only 3 months of expenses and the rest (2yrs=24 months-3 months{paid for this year}) 21 months money is said to be a prepaid expense.
*It means the expenses which we would have incurred in the coming years is paid today itself in advance
and hence the workout will be something like this
To Advertisement A/c XXX (full 24 month money)
less: advertisement expenses prepaid( 3 months of expenses)
and henceforth we will have our 3 months of expenses accounted
and rest 21 months will continue to be written off in the following years.