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AA-5-Bidding Documents Payment Entry

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Accounts Officer

563 Points Posted on 29 March 2023

Hi Respected Members,

Please educate me on following:

We purchased a bidding documents from client thru pay order to bid for a project. How we will record it ? And what will be nature of this account ?

Thanks in Advance.

Replies (2)

Quick Summary

This discussion clarifies how to record the payment for bidding documents purchased from a client. The recommended accounting entry is to debit a 'Bidding Document Expense' account and credit 'Cash/Bank'. The nature of this account is an expense, representing a cost incurred. It also addresses a query about deferring the expense recognition until after a potential acquisition in the next financial year.

Ayush

Executive

11944 Points Posted on 29 March 2023

To record the purchase of bidding documents from the client

Debit : Bidding Document Expense account

Credit : Cash/Bank account.

The nature of this account would be an expense account since it represents a cost incurred to obtain the bidding documents.

Dhruvish parikh

22 Points Posted on 30 April 2024

I have made expense of bidding as of today, now i have to close my books of accounts but I dont want to book that expense today so that after acquisition in next financial year i can reliase at that time. Now the question is that can i do this, if yes then what accounting entry/practice shall I follow? Facts: cost for accquiring an investment or bidding has been made, but the investment will be made later.