Solve the journal entry
This query is : Open
01 June 2017
My query is, We have two partners in a company x and y. We have created two a/c x and y under capital a/c. Some times x & y receive cash from cash counter and they expense it for company purpose. will it be right if we Dr. X or Y a/c ? My colleague say X or Y a/c will be Dr. but according to accounting rules we never Dr. capital a/c. and in this case his capital will be in negative. I m trying to understand him that we should create imprest a/c with x or y name. Dear Sir, Humbly request clarify this issue
02 June 2017
when they received a cash, you have to Dr. cash a/c of the company. And when they use that monies for company expense it would not affect their capital account.
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