In Prepaid amortization the entry I made in AP is reversed in GL
HI,
I did the set up for Amortization of expense of 5000 USD for to be amortized in 5 months. I have the following issues.
1) The entry I made in AP for the full amount of 5000 USD viz. Prepaid Exp (Asset A/c )is debited and Accounts Payable ( Liability A/c) is credited) is just reversed in GL for each month for 1000 USD. Ideally the GL entry should be Expense (Expense A/c) is debit and Prepaid Exp (Asset A/c) is credit so that at the end of Amortization prepaid expense of 5000 USD will become zero .
2) The system created the amortization stage journals for 5 months for 1000 USD each but the GL entry is posted only for current month with P state and the other 4 journals remain in V state for the future month. This is how amortization will work?