26 July 2016
When the liability has ARISEN, we should make the entry for the same.... What is your query about cash payment, I am getting it...can you please elaborate with some numerical example?
27 July 2016
if it is paid in cash/ through cheque, then debit concerned expenses....gift or stationery or festival bonus...as the case may be credit cash/ bank.... as the case may be
27 July 2016
just to stretch the concept to far end...... think of a situation where in the joint meeting of management and workers, it is resolved and agreed to pay festival bonus.... then on the same day, one may pass the entry debit festival bonus credit festival bonus payable.... ....(Liability is thus created)
And when in due course, the actual payment is made debit Festival bonus payable credit Cash/Bank...as the case may be