Accounting

This query is : Resolved

Suraj (Querist)
Follow

27 January 2011 Hi sir/ madam
I hv query regarding accounting treatment of excess provision of expenses whether it can be transferred to respective account head for which provision was made or other account head (Liabilities written back)

Regards
Surajk

Sunil Kr. Sanganeria

Sunil Kr. Sanganeria (Expert)
Follow

27 January 2011 It should be transferred to Liabilities Written Back A/C

ACMA Obulirajan R

ACMA Obulirajan R (Expert)
Follow

27 January 2011 1. If the provision was made during the previous year, then You can do the following entry

CR PREVIOUS YEAR ADJUSTMENT A/C
DR PARTICULAR LIABILITY A/C

2. If the provision created during the current year, then You can do the following entry

CR RESPECTIVE EXPENSES A/C
DR PARTICULAR LIABILITY A/C

Thanks