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Entry of bank transaction

Yasir (article assistant ) (432 Points)

06 July 2021

how to show bank entries of a proprietor ship which is not related to business I. e other payment and other receipts

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7 Replies

yasaswi gomes (My grammar is 💯 good I) (7290 Points)
Replied 06 July 2021

Is the director using the company bank account- use withdrawals accounting or petty cash accounts if the check is drawn for transport or entertainment etc. What are other receipts & payments mentioned above? txs

CMA Poornima Madhava (CMA) (13097 Points)
Replied 06 July 2021

You may credit or debit such transactions to the drawings account.

Yasir (article assistant ) (432 Points)
Replied 06 July 2021

Can i show cash withdrawal or deposit

CMA Poornima Madhava (CMA) (13097 Points)
Replied 06 July 2021

I didn't get you. What I meant is debit drawing account with withdrawals and credit drawing account with deposits.

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yasaswi gomes (My grammar is 💯 good I) (7290 Points)
Replied 06 July 2021

In the bank account, you have to show everything and where the money is transferred to like withdrawals or miscellaneous/petty expenses account.

prasad Nilugal (3914 Points)
Replied 06 July 2021

You can show expense which were withdrawn by the proprietor as a drawing , but you can't credit to drawings account because drawing means withdrawal from business by the proprietor .
So Income which were received other than business can be shown as Other Income in P&L account under indirect Income subject to documentary evidence , but you can't credit to Drawings account .

So for Drawings you can pass entry as follows
Drawing A/c Dr
To Bank A/c Cr
( Being expense from business for personal use)
Transfer to capital account
Capital A/c Dr
To Drawings A/C Cr
( Drawing transfer to capital account)

For Income you can pass entry
Bank A/c Dr
To Other Income A/c Cr
( Being other income credited to Bank)
Transfer entry
Other income A/c Dr
To Profit and Loss A/c Cr
( Other income transfer)

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prasad Nilugal (3914 Points)
Replied 07 July 2021

You May also credit all other Bank receipt to proprietor capital account not belong to business .

Bank. A/c Dr
To proprietor capital account A/c Cr
( Being amount received in Bank not belong to business .)