Entry and carryforward of cash/chq gift in balancesheet
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
08 January 2014
Sir,
Kindly clarify whether money gifts (whether cash or thru chq.) given to the donee in a particular accounting year and shown as assets in the balancesheet of that a/c year are carried forward and shown as assets in the balancesheet(of the donee) of the successive accounting years also ? Carry forward of immovable assets is the rule but what about cash gifts.I am asking because cash gifts received in an accounting year can be spent in the same year then whats the use of showing it as an asset in the successive a/c years.
Please reply
Thanks
Kindly clarify whether money gifts (whether cash or thru chq.) given to the donee in a particular accounting year and shown as assets in the balancesheet of that a/c year are carried forward and shown as assets in the balancesheet(of the donee) of the successive accounting years also ? Carry forward of immovable assets is the rule but what about cash gifts.I am asking because cash gifts received in an accounting year can be spent in the same year then whats the use of showing it as an asset in the successive a/c years.
Please reply
Thanks
CA PARAS BAFNA
(Expert)
08 January 2014
Cash received as a gift remains cash only until it is spent.
.
As soon as cash is spent, cash balance reduces accordingly. If you spend all the money, the balance reduces to Zero. So, in such a case you will not carry forward any asset as Cash.
.
.
As soon as cash is spent, cash balance reduces accordingly. If you spend all the money, the balance reduces to Zero. So, in such a case you will not carry forward any asset as Cash.
.
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