accounting
This query is : Resolved
19 January 2009
a company has shown in its balance sheet Cheques on hand(cheques received from customers)seperately as a current asset.
Is the accounting treatment correct?
Is the accounting treatment correct?
19 January 2009
Yes, it is correct. The situation arises in the following circumstances:
Suppose, a cheque has been received from a customer on the last day of the year and receipt to that effect has been issued. Now, the cheque is deposited in April in the next year. It is obvious that cheque remained in hand as on the last day of the year and will be booked and reflected as CHEQUE IN HAND as a Current Asset in the B.Sheet.
Suppose, a cheque has been received from a customer on the last day of the year and receipt to that effect has been issued. Now, the cheque is deposited in April in the next year. It is obvious that cheque remained in hand as on the last day of the year and will be booked and reflected as CHEQUE IN HAND as a Current Asset in the B.Sheet.
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