Creating Prepaid Expenses

In Centage, you can analyze your company’s data and create budgets and forecasts for revenue and expenses.

Operating expenses (ordinary business costs such as rent or office supplies) are a crucial part of your company’s budget. You can add operating expenses to your budget in Centage.

Many companies pay expenses ahead of time, such as office rent for a year. In Centage, you can budget for these prepaid expenses as well as expenses you pay immediately or over time.

This document shows you, a Centage user, how to create prepaid expenses through the Operating Expenses application.

Step 1: To create a prepaid expense, open the Worksheets module and select Operating Expenses.

The Operating Expenses application opens. Use this application to add, edit, and delete expenses, including prepaid expenses. 

Example: One of this company’s prepaid expenses for the year is Workman’s Compensation insurance, which is invoiced in March and paid in April.

Step 1: To add a prepaid Operating Expense, click the Add icon ( ). 

Step 2: The new Data Projection appears below. Double-click on the row in the Name column and enter a name for this prepaid expense. 

Step 3: Double-click on the row in the Account Number column and select an account number for this prepaid expense. 

Step 4: Double-click on the amount in the Amount column and enter the total amount for this prepaid expense. 

Step 5:  Double-click on the Spread Method column and select the spread method for this prepaid expense.

Step 6: To set up the expense’s prepaid properties, click the Arrange icon ( ) to open the Properties pane. 

Step 7: In the Arrange panel, scroll down to the Properties pane, click on the field next to Start Date and select the Invoice Date for this prepaid expense (January 1 in the example).

Step 8: Scroll down to the Prepaid section and click on the Enable Prepaid Calculations toggle switch to turn it to the ON position.

New fields appear below. 

Step 9: Double-click on the field next to Prepaid GL Account and select a GL Account for this prepaid expense.

Step 10: Double-click on the field next to Prepaid(Schedule) to select a Recognition for this prepaid expense. 

Step 11: Select Click to Edit next to Allocation Method to select an allocation method for this prepaid expense. 

After setting up this prepaid expense, you can open the Details pane to see how it hits the related GL Accounts. To open the Details pane, click the Expand icon ( ) at the bottom of the page.

The Details pane displays the timing and GL Accounts debited and credited for this prepaid expense.