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should it be reversed?

646 views 3 replies

Anwar

PRACTISING CHARTERED ACCOUNTANT

85 Points Posted on 24 August 2009

Dear Friends :

Me having a small doubt.

Expense met by chq on 1.1.2009 for Rs 150000/-.Chq is still uncleared as per our brs as on the date. should the entry be reversed in our ledger to show the exact expense incured during the year

Thanks in advance

Anwar

Replies (3)

ashish gupta

student

1922 Points Posted on 24 August 2009

Hi.. Anvar

Entry need not be reversed as we follow the accrual basis. if it is expense of the year 2008-09 it has to be taken in that period only.

Giridharan K

Student

123 Points Posted on 24 August 2009

Reverse the bank entry and credit expenses payable A/c.

Ashish M

Chartered Accountant

2731 Points Posted on 24 August 2009

Cheque seems to be issued on 1.1.09. It become a stale cheque by 30.6.09. Party need to be communicated with and asked for the proceeding as to why cheque was not deposited. as for ur own books, the expense shall not be deemed to be incurred and the entry need to be reversed.............