Accounting entry
This query is : Open
29 September 2016
hi sir
one of the director has taken the funds from business more than his capital and quit the company
Ex: His share capital 500000
but he has taken from the company is 2000000
so please tell me how to adjust the entry URGENTLY.....
Kaushik Joshi
(Expert)
29 September 2016
show remaining amount as receivable from him.
Kaushik Joshi
(Expert)
02 October 2016
show amount as receivable for 3 years then write off
02 October 2016
is it mandatory to show the amount for 3 years or not
if not please tell me the entry what we need to pass....
Kaushik Joshi
(Expert)
02 October 2016
It would be unwise to write off immediately the whole amount since other directors wouldn't agree with it. also you can sue the director and as per law of limitations, you've a period of 3 years to file an application against him in court. Hence I recommend to show it as receivable. Also writing off the entire difference of 15lakhs to p&l will be wrong immediately in the year of misshapen. So either show as receivable or if all directors agree that leave the amount, then write off.
to write off you will transfer the difference as bad debt.
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