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This query is : Resolved

riddhi (Querist)
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09 July 2014 When I make provision for expense at year end the balance should reflect just the which will be clubbed with the opening provision so the balance will be nil.

eg: electricity bill period is suppose 15th march to 15th april is Rs. 1000 /- so I make 15 days provision for march Rs. 500/- in the year end 31/3/2014 and balance Rs. 500/- for april 15 days I pass the entry in next year and the total of the two will be equal to Rs, 1000 /- the amount paid and will be nil.
but in my books due to excess paymentits showing debit balance what to do please help

Vishnu Saboo

Vishnu Saboo (Expert)
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23 July 2014 entry must be ass following
say your expenses estimated 500 for 15th mar to 31st mar.
Electricity exp dr 500
To Outstanding Liability 500
(provision made for 15th mar to 31 mar)

you received bill of 1000/- on 15th apr.
you have to pass

Electricity exp 500 (1 apr to 15 apr)
Outstanding liability ac 500 Dr
To Party 1000

remember you have to pass only that much amount in OL a/c which you made provision, if actual bill is more than or less than your estimation, diff to be charge in expenses a/c.

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