Journel entry in books ?

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When a company director purchases gold for personal use using company funds, a specific journal entry is required. The company should debit a Director's withdrawals or Loan account and credit the Bank account for the total amount, including GST. Importantly, the company cannot claim Input Tax Credit (ITC) on gold bought for the director's personal consumption.

Kapil Agarwal

Kapil Agarwal (Querist)
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20 August 2022 Company Owner Purchase Gold Worth 1,50,000.00 For Personal Use From Company GSTIN . Then What Will Be Entry In Company Books

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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20 August 2022 What do you mean by company owner? Is it Director of the company?

Kapil Agarwal

Kapil Agarwal (Querist)
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20 August 2022 Yes director of the company

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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20 August 2022 The company can make the owner withdrawal journal entry by debiting the Director's withdrawals or Loan account and crediting the Bank account. The total withdrawal would include GST. The company cannot claim ITC over the gold purchased for personal use of the Director.

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