Accounting treatment

This query is : Resolved

Sabiyath.k.p

Sabiyath.k.p (Querist)
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17 April 2014 Dear sir

I have a doubt regarding accounting treatment of purchase of share for investment purpose by a proprietor.

please help me to pass journal entry for the same in the books of account.and please explain the rule behind such an entry.

Thank You.

Sandeep Dharar

Sandeep Dharar (Expert)
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17 April 2014 It will come under Current Assets as Investments in shares:

Investment in Shares Dr
To Bank
(Being purchase ..... No. Eq/Pref. shares of ...... Ltd @ rs... per share).

Since it is an investment by a proprietor hence it will consist current assets.

Rupesh Jain

Rupesh Jain (Expert)
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17 April 2014 if prop. make the purchase . normally it show in his personal balance sheet not in his business balance sheet.

it show under the investment head
and show at cost price. and you cash show market value in bracket.in balance.

journal entry is correct tell by
Mr. Sandeep

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