Pvt Ltd. company's expenses done by directors personal credit card.

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please suggest the accounting solutions for some payments made by directors of the company for the expense of a private limited company.
expenses like utility bills, travelling expenses for official tour n other expenses etc...
Replies (3)

TIf your company is following standards, the above two fall under imprest accounting that is petty cash. But again classification also depends on the nature of expenses, if it is business tour, it is expensed as travelling expenses. The amount of expenditure classifies it as petty or normal e penditure

Such expenses are petty cash expenses. Record with under appropriate nature of expenses

pass  J.E  as follows  in the books  account 

Expense            A/c    Dr 

To  Director       A/c     Cr 

(  Company  expense paid by Director  ) 

 

When  reimburse  such  expense  to  Director  then  pass  entry  

Director           A/c     Dr 

To  Cash / bank   

(  reimbursement  of  expense  to  Director    )  

Note - Director  A/C  under  Current  liability  Balance sheet . 

 


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