Performance bank guarantee related entries in tally

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Afaque Ali (Querist)
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22 February 2018 Sir My co. Got a new govt. Contract & made a performance Bank guarantee of 488000₹+ (bank charges extra) against a FD amount 500000 ₹. I wanted to know how to make all entries in tally accounting & under which accounting head I create accounts.

Afaque Ali

Afaque Ali (Querist)
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27 February 2018 Is anyone here to help me out..& clear my doubts

CMA Sivarama Krishnan TS

CMA Sivarama Krishnan TS (Expert)
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03 April 2019
There will not be any accounting entry for Rs. 4880000; only it will be shown by way of Notes under the Cash and Bank Schedule of Balance Sheet where the Fixed Deposits Grouping will be included that Fixed deposits to the order of Rs. 4880000 are earmarked and under lien with bank for performance guarantees. Also, it will be included under the contingent liabilities amount in Notes of Accounts.
However, accounting entry for bank guarantee charges (extra) will be passed viz.,
Bank Charges (P&L Expense) Debit as applicable for current year out of the amount debited by bank as bank guarantee charges;
Pre-paid Expenses (Balance sheet - Current Asset) for the remaining amount
To Bank (Credit - Payment) for the whole of bank guarantee charges
Hope this is clear
SivaramaKrishnan TS, BCom, FCMA
mysruthi@yahoo.co.uk

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