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Car Loan A/cing entry

Chartered Accountant


Hi,

A co. has bought a car as their asset this year on loan.I m getting problem how to make entries in the tally to show the effect on loan a/c & Interest on loan a/c.

Car value- Rs.1910000

LOAN- Rs.1500000,

Down payment- Rs.605000

EMI- Rs.47477 for 36 months

Interest- 9.25% p.a

Pls. guide me with proper entries for current year & when making entries for EMIs from next year.

Thx

 
Reply   
 

Mr.Ramikhalsa, i guess the info. provided by you in regard to EMI per month is wrong. It must be Rs.47874.00.

When loan is received:

DEBIT            Bank  A/c.       15,00,000.00

CREDIT         Loan A/c.        15,00,000.00

When you repay your instalment:

DEBIT        Loan A/c.        With Principal amount contained in the instalment

DEBIT        Interest on Loan A/c    With the amount of Interest in the instalment

CREDIT     Bank A/c.                   With the whole instalment amount.

                                                                           


Total thanks : 1 times

 
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