Hello All,
Suppose company ( B) is in india and incurred expenditure and issue invoice to its HO (A) in USA for reimbusement of expenses. what will be the Journal entry in both the books of account.
India company books;
expense a/c
To Bank/Cash a/c
(expansion incurred by India company)
H.O a/c
To Reimbursement a/c (P&L)
(posted as debtors/receivables)
Bank a/c
To H.O a/c
(once Reimbursement is done)
H.O books;
expenses invoice a/c
To Payables/India Company a/c
(invoice received by head office)
Payabls/India co. a/c
To Bank a/c
(when head office clears payments)
CAclubindia
