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Credit card expenses by partner

Prasad Shah (Managing Partner) (65 Points)

20 February 2013

Our Company's Partner is using his own Credit Card for Petrol Expenses as well as booking tickets of Airlines for Business Travel and also for Food Expenses for Company Work while travelling out of station.

Please help me to know how to make entries of this expenses in Tally ERP 9.

ie. Rs.2000 Fuel Charges paid on 11-02-2013 by the partner through his ICICI Credit and Bill is submitted to the company.

Also please advise which accounting heads are to be used??

Thank you.

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10 Replies

Giridhar S Karandikar (Team Lead) (7543 Points)
Replied 21 February 2013

Debit the respective expense account & credit Bank/Cash Account. Provide a breif narration regarding the re-imbursement of the exp to the partner.

Prasad Shah (Managing Partner) (65 Points)
Replied 21 February 2013

Thank you Sir.

Can you please tell me that Credit Card Expenses comes under what Account Head?

Giridhar S Karandikar (Team Lead) (7543 Points)
Replied 21 February 2013

you do not need to create a seperate acc for credit card exp. You need to debit the respective account say Petrol Exp and credit bank/cash. however in narration you specify in breif that the exp are being met by cr card by the partner & they are re-imbursed.

Else yo9u can also create the account as Credit Card Exp-Petrol under indirect exp and credit Bank/Cash. Give a breif narration as who had incurred the exp and it is re-imbursed.

Prasad Shah (Managing Partner) (65 Points)
Replied 21 February 2013

Thank you for your prompt response Mr.Giridhar.

Understood.

But we make Partner's Credit Card Payment directly from our company's current Account.

Partials expenses are their private, which is debited from their Capital A/C.

We are confused about how to make entries.

For ie.

January Month, Credit Card Expenses

Rs.5000 paid for Petrol by Credit Card

Rs.10000 for Flight Tickets for Partner and one of employee for business travel.

Rs.1000 for Stationary Purchase.

Rs.2000 paid for Food Expenses from Credit Card

and

Rs.10000 for Partner's Personal Expenses, not Company Expenses.

On Feb, Company paid full Credit Card Bill from Comapny''s Current Account.

How to adjust all entries?

Giridhar S Karandikar (Team Lead) (7543 Points)
Replied 21 February 2013

pass the below entry

Petrol Exp Dr 5000

Travelling Exp Dr 10000

Printing & Stationery Dr 1000

Office Exp Dr 2000

Drawings Dr 10000

To- Bank A/c 28000

You can also follow one method. i.e. Create 'Credit Card(bank name) under the head Current Assets. when the payment of the credit card bill is being made then at that time pass the below entry

Credit Card A/C Dr

To-Bank

Then you can pass a JV by debiting the respective accounts with the amounts as shown above and credit 'Credit Card A/c. In this way your Credit Card Account should get closed each month.