What is closing entries and transfering entries.........and where and when they're used
Menu
Entries
Replies (3)
At the time of closing books of accounts (generally on 31st March of every year) some income are accrued or unaccrued. Likewise some expenses are prepaid or outstanding. Entries made to adjust these type of transactions on 31st March are called Closing entries.
During the whole year some entries are either made to wrong accounts or to non-relevant accounts. Besides this, some payments/receipts are not directly to/from the respective account rather the same are passed through some other route; e.g.XYZ rendered its services to A Ltd (Kanpur Unit) but payment to XYZ made by A Ltd (Lucknow Unit) and thus adjustment entry/transfer entry made between A Ltd (Kanpur) and A Ltd (Lucknow) will be said a Transfer entry.
Closing entries are journal entries made at the end of an accounting period to transfer temporary accounts to permanent accounts.
TRANSFER JOURNAL ENTRY is used to allocate an expense or revenue from one account or sponsored project to another, or to transfer funds between object codes within an account or sponsored project. Transfers journal entries should include a descripttion of the item(s) and explanation of why the transfer is necessary.
Recent Topics :
- CA FINAL FR FINANCIAL INSTRUMENTS (Ind AS 109) Dou
- 70:30 GST rule for solar EPC: partial scope (struc
- TDS on Redevelopers hardship allowance received no
- Who will take FSSAI AND TRADE LICENSE: owner or te
- E Way Bill in respect of Without Bringing Material
- FAST DS 2026 query
- Consultation
- E-way notices for FY 22-23
- Gst file not created
- Regarding 3CEB query
Related Topics :
CAclubindia
