Packing Credit and LC accounting
This query is : Resolved
Bharath Kumar
(Querist)
12 July 2010
Please explain the accounting procedure involved in PC and LC
13 July 2010
The following examples are hypothetical.I am keeping this query open for further opinion.
Accounting for LC
On opening an LC amounting to Rs 1000/-in favour of a 3rd party with the bank :
a) Margin Money Deposit Dr 250
To Bank 250
On Maturity of LC
b) Bank Dr 275
To Margin Money deposit 250
To Interest on Margin Money Deposit 25
c) Sundry Creditor Dr 1000
BAnk Charges/Interest Dr 120
To Bank 1120
Packing Credit
This is a term loan.In my opinion entry will be debit bank account and credit Loan Account.
Accounting for LC
On opening an LC amounting to Rs 1000/-in favour of a 3rd party with the bank :
a) Margin Money Deposit Dr 250
To Bank 250
On Maturity of LC
b) Bank Dr 275
To Margin Money deposit 250
To Interest on Margin Money Deposit 25
c) Sundry Creditor Dr 1000
BAnk Charges/Interest Dr 120
To Bank 1120
Packing Credit
This is a term loan.In my opinion entry will be debit bank account and credit Loan Account.
Bharath Kumar
(Querist)
15 July 2010
Expecting revert from other experts also
Dhirajlal Rambhia
(Expert)
31 July 2023
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Depreciation Chart Companies Act
- GST Audit whether Govt Companies are exempt?
- PTRC Show Cause Notice on Email
- Accounting treatment of AMC alongwith the purchase of Laptop
- Unable to File TDS Q2 Return – New TRACES Portal Error
- Taxation of crypto futures in India Fy 2026- 2027
- MSME disclosure and disallowance
- EPF ECR NEW RULES Sep 17th 2026
- Issuing of delivery challan by seller of goods
- Transfer of Physical Stock Between Two Proprietorship Concerns
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
