Template · Accounting
Prepaid expense and accrual amortization schedule
Amortize prepaid expenses by month and track accrual reversals against a close month.
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XLSXCSVODSXMLNumbers| Prepaid expenses and accruals | ||||
| Example data — replace the blue input cells with your own. | ||||
| PREPAID BALANCE AT YEAR END | EXPENSE RECOGNIZED THIS YEAR | OPEN ACCRUALS AT CLOSE | ||
| 6,558.36 | 50,501.64 | 11,928.50 | ||
| Inputs | ||||
| Fiscal year start month | Jan 1, 2026 | First day of the fiscal year. The month columns run from here. | ||
| Close month | Sep 2026 | An accrual whose reversal month is on or before this month shows Reversed. | ||
| Fiscal year end | Dec 31, 2026 | |||
| Year-end results | ||||
| Prepaid balance at fiscal year end | 6,558.36 | |||
| Prepaid expense recognized this fiscal year | 50,501.64 | |||
| Open accruals at close month | 11,928.50 | |||
| Open accrual entries | 4 |
Showing the first 16 of 34 rows and 5 of 5 columns. Cells with formulas show the formula on hover.
| Prepaid expense amortization | |||||||||||
| Straight-line amortization over the service months. Blue columns are inputs; the rest are formulas. | |||||||||||
| Monthly amount is rounded to the cent; the final service month takes the rounding difference. | |||||||||||
| Item | Vendor | Invoice amount | Service start | Months | Monthly amount | Last service month | GL account | Jan | Feb | Mar | Apr |
| General liability insurance, annual policy | Northwind Example Insurance | 9,600.00 | Feb 2026 | 12 | 800.00 | Jan 2027 | 1300 | 0.00 | 800.00 | 800.00 | 800.00 |
| Accounting software subscription, annual | Bluepine Example Software | 4,380.00 | Apr 2026 | 12 | 365.00 | Mar 2027 | 1310 | 0.00 | 0.00 | 0.00 | 365.00 |
| Warehouse rent paid in advance, six months | Lakeside Example Properties | 27,000.00 | Jul 2026 | 6 | 4,500.00 | Dec 2026 | 1320 | 0.00 | 0.00 | 0.00 | 0.00 |
| Forklift maintenance contract, two years | Harbor Point Example Service | 5,400.00 | Nov 2025 | 24 | 225.00 | Oct 2027 | 1330 | 225.00 | 225.00 | 225.00 | 225.00 |
| Cyber liability insurance, six months | Northwind Example Insurance | 3,600.00 | Oct 2026 | 6 | 600.00 | Mar 2027 | 1300 | 0.00 | 0.00 | 0.00 | 0.00 |
| Trade show booth, 2026 show | Example Expo Group | 6,500.00 | Mar 2026 | 3 | 2,166.67 | May 2026 | 1340 | 0.00 | 0.00 | 2,166.67 | 2,166.67 |
| Domain and hosting, two-year prepayment | Cedar Example Hosting | 720.00 | Jun 2026 | 24 | 30.00 | May 2028 | 1310 | 0.00 | 0.00 | 0.00 | 0.00 |
| Vehicle registration, annual | Example County Clerk | 310.00 | May 2026 | 12 | 25.83 | Apr 2027 | 1300 | 0.00 | 0.00 | 0.00 | 0.00 |
Showing the first 16 of 45 rows and 12 of 25 columns. Cells with formulas show the formula on hover.
| Accrued expenses and reversals | ||||||
| Each accrual reverses in the month after it was incurred. Status compares the reversal month with the close month. | ||||||
| Description | GL account | Month incurred | Amount accrued | Reversal month | Status | Basis |
| Electricity used in September, estimated | 2110 | Sep 2026 | 3,240.00 | Oct 2026 | Open | Meter reads through September 25; bill not yet received |
| Electricity used in August, estimated | 2110 | Aug 2026 | 3,105.00 | Sep 2026 | Reversed | Estimate from prior-year usage; reversed when the bill arrived |
| Staff bonus accrual, September | 2100 | Sep 2026 | 5,000.00 | Oct 2026 | Open | Bonus plan accrues evenly through the year |
| Equipment loan interest, September | 2120 | Sep 2026 | 1,188.50 | Oct 2026 | Open | Loan schedule, interest for September |
| Outside accountant fees, year-end review | 2130 | Sep 2026 | 2,500.00 | Oct 2026 | Open | Engagement estimate, work performed to date |
| Freight invoices not received, August | 2010 | Aug 2026 | 1,870.25 | Sep 2026 | Reversed | Receiving reports matched; invoices pending |
| Payroll for the last days of August | 2100 | Aug 2026 | 9,640.00 | Sep 2026 | Reversed | Payroll register, August 26 to August 31 |
| Property insurance premium audit adjustment | 2130 | Jul 2026 | 720.00 | Aug 2026 | Reversed | Carrier audit notice dated July 14 |
Showing the first 16 of 45 rows and 7 of 7 columns. Cells with formulas show the formula on hover.
| Prepaid expense and accrual amortization |
| Notes: what this workbook does, how to use it and the method behind it. |
| What it does |
| Spreads prepaid expenses over their service months and shows the expense for each month of the fiscal year, the balance left at year end, and the accruals that are still open at the close month. A month-by-month table on the Summary tab to… |
| How to use it |
| 1. On the Summary tab, enter the fiscal year start month and the close month. |
| 2. On the Prepaids tab, enter each prepaid: item, vendor, invoice amount, first service month, number of months and GL account. Read the monthly amount, the expense for each month and the year-end balance. |
| 3. On the Accruals tab, enter each accrual: description, GL account, month incurred, amount and basis. The reversal month and status are calculated. |
| 4. Read the year-end results, the checks and the month-by-month table on the Summary tab. Both checks read OK when every prepaid amortizes to its invoice and every accrual falls in the fiscal year. |
| Formulas and method |
| Monthly amount = invoice amount / months, rounded to the cent. The final service month = invoice amount - monthly amount x (months - 1), so the total equals the invoice exactly. |
| A fiscal month's expense = monthly amount for each service month inside the life, and the final amount in the last service month. |
| Balance at fiscal year end = invoice amount - amortization through the fiscal year end. |
Showing the first 16 of 31 rows and 1 of 1 columns. Cells with formulas show the formula on hover.
What does this template do?
This workbook spreads prepaid expenses over their service months and tracks accrued expenses through their reversals. Each prepaid has an invoice amount, a first service month and a number of months. The monthly amount is the invoice divided by the months, rounded to the cent, and the final service month takes the rounding difference, so the amortization adds up to the invoice exactly.
The Prepaids tab shows the expense in each of the twelve fiscal months, the expense for the year, the balance left at year end, and two checks: the life check and the fiscal check. The Accruals tab gives each accrual a reversal month, the month after it was incurred, and marks it Reversed or Open against the close month on the Summary tab. The Summary tab also shows a month-by-month table of prepaid expense, accruals recorded and accruals reversed.
The example data is fictional: eight prepaids and eight accruals for a calendar fiscal year 2026, with a September 2026 close.
What’s inside
- Monthly amortization rounded to the cent, with the final month absorbing the rounding
- Expense for each of the twelve fiscal months, the year total and the year-end balance
- Life check and fiscal check that tie each prepaid back to its invoice amount
- Accrual reversal month and Reversed or Open status against a close month
- Month-by-month totals of prepaid expense, accruals recorded and accruals reversed
Which tabs does the workbook have?
| Tab | What it holds |
|---|---|
| Summary | Fiscal year inputs, year-end results, the checks and the month-by-month table. |
| Prepaids | One row per prepaid with monthly amount, fiscal-month expense, year-end balance and checks. |
| Accruals | One row per accrual with its reversal month and status. |
| Notes | Purpose, steps, formulas used, assumptions and limits. |
What formulas does this template use?
This template holds 929 formulas in 1,095 cells across 4 tabs, so 85% of its cells calculate. They use 12 distinct functions; the longest formula is 379 characters and 174 of them read from another tab.
| Function | Uses | What it does |
|---|---|---|
MONTH | 3,440 | month of a date |
YEAR | 3,440 | year of a date |
IF | 2,082 | one result when a test is true, another when false |
OR | 480 | true when any test is true |
EDATE | 129 | same day, months later |
ABS | 80 | absolute value |
SUM | 61 | adds numbers |
ROUND | 40 | rounds to a number of digits |
SUMIFS | 24 | adds values meeting several conditions |
SUMPRODUCT | 6 | multiplies matching entries, then adds them |
COUNTIF | 1 | counts cells meeting one condition |
SUMIF | 1 | adds values meeting one condition |
Counted from the workbook itself. Only functions that Excel, LibreOffice Calc, Google Sheets and Apple Numbers evaluate the same way are used, so the formulas survive every download format.
How do you use it?
- On the Summary tab, enter the fiscal year start month and the close month.
- On the Prepaids tab, enter each prepaid's invoice amount, first service month, months and GL account.
- On the Accruals tab, enter each accrual's description, GL account, month incurred and amount.
- Read the year-end balance, the open accruals and the month-by-month table on the Summary tab.
- Confirm the prepaid check and the accrual check read OK.
What is it good for?
- Amortizing annual insurance and software subscriptions
- Tracking rent or maintenance paid in advance
- Listing accrued utilities, bonuses and fees at a month-end close
- Checking which accruals still need to be reversed
Questions about this sheet
How is the rounding handled?
The monthly amount is rounded to the cent. The last service month takes the difference, so the total equals the invoice amount.
What does Reversed mean for an accrual?
The reversal month is on or before the close month, so the accrual has been reversed in the ledger. Open means it still needs to reverse.
Does the schedule handle a partial first month?
No. Amortization runs in whole months, starting in the service start month.
Are the journal entries posted?
No. The workbook shows the amounts to record and does not post them to a ledger.