07 October 2018
When we open a normal bank account ie dr balance entry we pass is: Bank a/c dr to Cash In this case since it is case of bank overdraft entry will be: Bank a/c dr/cash a/c dr to bank overdraft a/c (Being overdraft received from bank)
ABove entry is in books of firm/ individual who willl take over draft from bank Whereas bank will pass the following entry in its books: Bank overdraft dr to cash/ bank (Being overdraft a/c opened for the concerned customer)
CAclubindia
