Accounts entry for an order where client (overseas) paid direct to exporter’s sub contractor

To record this transaction, make the following entries:

1. Record the subcontractor's invoice:

   • Debit: Subcontractor Expense (full amount of the invoice)
   • Credit: Accounts Payable (full amount of the invoice)

2. Record the payment received from the client:

   • Debit: Cash/Bank (amount paid by the client)

Originally posted by : muhammad malik
	To record this transaction, make the following entries: Record the subcontractor's invoice: Debit: Subcontractor Expense (full amount of the invoice) Credit: Accounts Payable (full amount of the invoice) Record the payment received from the client: Debit: Cash/Bank (amount paid by the client)

Hello

in this case if we pass the entry as above, will it always show and accounts payable amount to the sub contractor? If yes how can we settle that because this payment has been made to the contractor by client directly.

Hi

Can you please guide the right way to do the entry and transaction?