Government grant?

Hi VS...

1.Bank a/c Dr

To university a/c ( shown under liabilities in Balance sheet)

The first entry to book the grant recd which will be shown in B/S

2.Salary a/c Dr.

Electricity a/c Dr.

Telephone a/c Dr.

To bank a/c

The second entry will book the expenses which were incured and the same will be transfered to the P&L as follows.

P&L A/C                          Dr

To Salary a/c

To Electricity a/c

To Telephone a/c

Hence P&L A/C got affected to the extent of exp incurred.

at the end everything will adjsuted.

loss in P&L will stand against the university (liability)

this will keep control to ensure proper utilisation

No one explined to that gentleman what the grant is.

The grant is an amount given by Govt/Autonmous bodies/Aid-banks for a specific purpose subject to specific conditions.

The grant should be shown separately in P&L a/c separately and the expenditure incurred against that also should be shown separately in such away that it is possible to know the grant -vs-vis- Expd.

kkm