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Should I treat renewal fee of our Business License an outright expense or as prepaid expense then amortize over the financial year?

Financial Transactions
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Question added by Daisy Jane Jomaya-Corporal , Accounts Payable Analyst , Forever Living Products FZE
Date Posted: 2016/02/21
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Mohammad Tajuddin Mohammad
by Mohammad Tajuddin Mohammad , Accounting Manager , United Trading Corporation

Yes, you can debit prepaid account and amortize the annual fee period.

 

Fathi Matbaq
by Fathi Matbaq , Senior Purchasing Officer , Alghanim Industries

If it's an annual fee, it's an outright expense.

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