Loans and advanced (asset)

I have 500000 rs as amount shown  under loans and advances(asset) group in myprevious 3 successive years of personal balancne sheet in tally. If i show it as not recoverable can this be added to capital account.

Is there any other way to make this figure nil under  loans and advances since it is made only for adjustment purpose  and no actual loans are given.

I want to eliminate this entry and come clean of it

Regards

Dilip khambete

Replies (5)
Quick Summary
This discussion addresses how to manage a £500,000 figure shown under 'Loans and Advances (Asset)' in a balance sheet for three consecutive years. The user seeks to eliminate this entry, as it was made purely for adjustment purposes and no actual loans were issued. Options explored include writing it off as a bad debt, potentially adjusting it against the capital account, or directly adjusting it with the proprietor's capital.

Write off as a bad debt and it will be automatically adjusted

If i do the following is it correct?

Creat bad debt ledger under capital group

Journal entry  F7 date 31.3.2023

bad debt-dr

Loans and advances (asset) --- cr

 

If i do the following is it correct?

Creat bad debt ledger under capital group

Journal entry  F7 date 31.3.2023

bad debt-dr

Loans and advances (asset) --- cr

Read more at: https://www.caclubindia.com/forum/loans-and-advanced-asset--593968.asp

Adjust with proprietor/partner,s capital account
Dr.Capital account
Cr loan and advance
Bad Debts should be under expenses.

It will be adjusted through current year profit reduction which will be adjusted in capital

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