We are having proprietory concern. We've shown LIC Investment in prop. business firm and the refund ag. money back policy recd. in Prop.'s individual name. How to account the same ?
We are having proprietory concern. We've shown LIC Investment in prop. business firm and the refund ag. money back policy recd. in Prop.'s individual name. How to account the same ?
As per me ...
The Accounting Entry Will be
Bank A/c.............dr
To LIC Investment a/c.........
and Investment in Propriter Concern in Personal Balancesheet will remain same if Proprietor doesnot withdraw the amount of money recd from LIC.........
And at the end of Investment Amount remaining amount will go into capital A/c.........
Bank A/c.........dr
To capital A/c...............
Suppose Investment was shown in LIC Rs.4,00,000
Maturity value received is Rs. 10,00,000
Entries will be made as under :
1. Bank a/c Dr. 10,00,000
To Investment in LIC 4,00,000
To Capital 6,00,000
(Lic maturity value received)
No tax is leviable on LIC maturity as explained by other experts.
O P Bagla & Co LLP
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