Lesson Plan

• Describe the difference between accrued income and prepaid income.
• Record journal entries for accrued income and for cash receipt of accrued income.
• Record journal entries for prepaid income receipt and subsequent revenue recognition.
• Prepare ledger T‑accounts that show the movement of amounts between cash, receivables, liabilities and revenue.
• Apply the concepts to solve a multi‑period end‑of‑period problem.

• Projector / interactive whiteboard
• Printed worksheet with journal‑entry tables
• Accounting textbook (IGCSE 0452 chapter on other payables/receivables)
• Calculators
• Sample ledger (T‑account) templates
• Whiteboard markers
• Student laptops or tablets (optional for spreadsheet practice)

Begin with a quick recall quiz on revenue recognition under the accrual basis. Ask learners to identify situations where income is earned before cash is received and where cash is received before the service is performed. Explain that today they will learn how to record these transactions correctly and produce balanced journal entries and ledger postings.

1. Do‑Now (5') – Short quiz on revenue recognition; students label examples as accrued or prepaid.
2. Mini‑lecture (10') – Define accrued income and prepaid income; illustrate impact on the accounting equation with simple examples.
3. Guided practice (12') – Demonstrate journal entries for accrued income, cash receipt of accrued income, prepaid income receipt, and revenue recognition.
4. Ledger activity (10') – Students complete T‑accounts for each transaction, checking that debits equal credits.
5. Independent problem (12') – Work on the $2,500 cash receipt example, recording both entries and updating ledgers.
6. Check for understanding (5') – Exit ticket: write one journal entry for accrued income and one for prepaid income.
7. Summary & homework (6') – Recap key points; assign textbook exercises on other payables/receivables.

Review the main differences between accrued and prepaid incomes and how each is reflected in journals and ledgers. Collect the exit tickets to gauge understanding, and remind students to complete the assigned textbook problems for further practice.