Ledger accounts query

House hold expenses are accumulated in drawings, 

a cash flow statement is sufficient for this purpose. 

Agree with Mr U.S.Sharma House Hold Expense debited to Drawings and shown on debit of capital Account while preparing the  return for the individual

i don't think so sir..we cannot mention in abrevation..it must elaborated..i guess.

Originally posted by : U S Sharma
	House hold expenses are accumulated in drawings,  a cash flow statement is sufficient for this purpose.

sir you have mentioned the treatment of household expenses my query was that while preparing books of ac. the short form of accounts head can be maintained or not?

there are two major part of cash flow

1) we use to spend for living, that is expenditure or drawings

2) we invest and capitalize the same , viz jewellary purchase, deposit in PPF, share purchase, payment towards any capital asset, 

a cash flow will show everything in the statement, where from we can select which one is to be capitalized and which one go to drawings, 

if we maintain books of a/c.s head wise then look at funny scenerio

debits 

1) domestic help ( maid) a/c

2) Grocery Shop

3) Green Vegetables

4) lunch/ dinner at resturent

5) driver salary

6) fun/enjoyment for children at fun/theme park

7) credit card payout

8) private tutor 

9) electric bills

10) guest maintanance

11) cloths/ effects

list would be endless heading wise, and it does not used for any purpose except incometax asset management.

as none of these is related to any deduction of incometax, and we are discussing here with incometax provisions, so we have to keep in mind that we have to bifurcate the expenses which are to be capitalized or to be taken as deduction from taxable income, balance debits of cash flow are "drawings"

i have mentioned to make a cash flow statement, there we can get a synopsis of all expenses in diff heads, and if needed we can segregate them headwise for any investigation purpose of department.

as the question is not of general nature, you are thinking something beyond normal provisions and related to deep investigations of department, please share the facts, there are so many ways to adjust the situation under the tax management. 

we can use common abbrevation while preparing the books according to IT Act, but only for those whise abbrevations are normal, like for Capital we can use Cap., for Miscellaneous we can use Misc. but for House Hold Expense we can not use HHE because its not an common abbreviation.

for the purpose of accounting ease, 

make drawings in these parts

drawings - cash  (it can be used as HHE)

drawings - deduction [ LIC / Tution Fees/ Mediclaim( everything under chapter VIA)]

any other nature of drawings can be also added 

viz

drawings - home loan interest

Gift tendered

Originally posted by : Govind Gupta
	we can use common abbrevation while preparing the books according to IT Act, but only for those whise abbrevations are normal, like for Capital we can use Cap., for Miscellaneous we can use Misc. but for House Hold Expense we can not use HHE because its not an common abbreviation.

that was the answer of my query

i was not asking about the treatment

thanks