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SBI life insurance

This query is : Resolved 

02 April 2020 Dear Sir, we have issued the cheque for SBI life insurance on 02. 04.2020 Please advise to me below is the right method of entry

CAPITAL A/C. DR. 31.03.20
SBI INSURANCE PAYABLE CR. 31.03.20

or any entry please suggest in books of account.

02 April 2020 Its just like drawing capital from business . In this case use the below instructions.
debit to the drawing account and a credit to Bank Account
At the end of the accounting year, the drawing account is closed by transferring the debit balance to the owner's capital account

22 May 2020 If the Insurance is personal of the proprietor/partner you can not show it in your books of accounts as liability.






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