Payment to creditor form other plant
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
05 February 2015
Dear Experts,
I would like to ask what journal entry(s) should pass in the case where a company has two plants plant A and Plant B. Now a payment of a creditor of plant A is made by plant B. Please solve the problem.
I would like to ask what journal entry(s) should pass in the case where a company has two plants plant A and Plant B. Now a payment of a creditor of plant A is made by plant B. Please solve the problem.
06 February 2015
If both plants maintain separate accounts then the following entry should be passed:
In the books of Plant A:
Creditor Account Dr
To Plant B Account Cr
In the books of Plant B:
Plant A Account Dr
To Cash or Bank Account Cr
In the books of Plant A:
Creditor Account Dr
To Plant B Account Cr
In the books of Plant B:
Plant A Account Dr
To Cash or Bank Account Cr
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