All Respected Members,
Please educate me that what would be journal entry for advance payment and balance payment of purchasing fixed asset (Computer) ?
Please share boy journal entry separately.
Thanks in advance for your precious time and efforts to reply this query.
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AA-32-How to Record Advance Payment for Purchasing Fixed Assets
Replies (3)
Quick Summary
Advance Payment Entry:
Dr. Supplier A/c - XXXXX
To, Bank A/c - XXXXX
(Suitable Narration as Advance paid for Computer)
Purchase of Computer:
Dr. Computer A/c - XXXXX
To, Supplier A/c - XXXXX
(Suitable Narration for Computer purchase and it's under Fixed Asset)
Payment Entry (Balance) :
Dr. Supplier A/c - XXXXX
To, Bank A/c - XXXXX
(Suitable Narration as Balance paid to supplier for purchase of Computer)
Dr. Supplier A/c - XXXXX
To, Bank A/c - XXXXX
(Suitable Narration as Advance paid for Computer)
Purchase of Computer:
Dr. Computer A/c - XXXXX
To, Supplier A/c - XXXXX
(Suitable Narration for Computer purchase and it's under Fixed Asset)
Payment Entry (Balance) :
Dr. Supplier A/c - XXXXX
To, Bank A/c - XXXXX
(Suitable Narration as Balance paid to supplier for purchase of Computer)
I will give you practical example , Computer Costing is Rs 50000/- +GST @ 18 % = 59000( total cost) was purchase from the supplier out of 59000/- Advance payment Rs 20000/- was made and balance payment Rs 39000/- was made later on when we received Computer and Invoice.
Advance to Supplier A/c Dr 20000/-
To Bank A/c Cr 20000/-
( Advance payment to the supplier)
Advance to Supplier A/c Asset side Balance sheet.
When he send computer along with Invoice pass entry
Computer A/c Dr 50000/-
Input CGST A/c Dr 4500/-
Input SGST A/c Dr. 4500/-
To Supplier A/c Cr. 59000/-
( Invoice booking entry)
Payment entry
Supplier A/c Dr c. 59000/-
To Advance to supplier A/c Cr 20000/-
To Bank A/c Cr 39000/-
( Balance payment made after adjusting advance payment)
Dear Raja P M and Parsad Nilugal,
Thanks a lot both to answer of my query.
Thanks a lot both to answer of my query.
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