For the Maid 2 Help partnership return, what entries might be different if the partnership...
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For the Maid 2 Help partnership return, what entries might be different if the partnership used the accrual method of accounting? The partnership would need to record, as cost-of-goods sold, any amounts that they did not receive in 2022 for services that they provided in 2022, for which they will be paid in 2023. O The expenses on page 1 may be less if they paid for certain prepaid expenses, such as insurance where the policy covers time in 2023. The amount prepaid in 2022 for 2023 would need to be recorded on Schedule L. The partnership could also have accounts payable balances and other current liabilities. The distributions that they each took will need to be recorded as guaranteed payments rather than as distributions. The income statement as reported on page 1 and the balance sheet as reported on Schedule L on page 5 will be the same as if they were using the cash method, but there will be additional entries on both Schedules M-1 and M-2.
The partnership would need to record, as cost-of-goods sold, any amounts that they did not receive in 2022 for services that they provided in 2022, for which they will be paid in 2023. O
The expenses on page 1 may be less if they paid for certain prepaid expenses, such as insurance where the policy covers time in 2023. The amount prepaid in 2022 for 2023 would need to be recorded on Schedule L. The partnership could also have accounts payable balances and other current liabilities.
The distributions that they each took will need to be recorded as guaranteed payments rather than as distributions.
The income statement as reported on page 1 and the balance sheet as reported on Schedule L on page 5 will be the same as if they were using the cash method, but there will be additional entries on both Schedules M-1 and M-2.
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