Dear Sir,
please advise below entry is correct
Dr. Insurance co. (loan & advance)
Cr. bank account
Dr. insurance expenses (indirect exp)
Cr. insurance co.
Perfect. But depends upon what software and accounts you use. Eg when you enter the transactions in a related ledger, the software will identify and transfer the amounts properly. Hence, journal entries will not be adequate for some transactions.
Purchases a/c
To Creditors a/c
when you clear off the payables
creditors a/c
To Bank a/c
then how will you pass on the fixed asset recognition entry?
So people will first account for the asset and cash like
Asset a/c
To Payables a/c
and when amount is cleared
Payables
To Bank
then how will you recognise purchases?
So ledger account balances are taken into account or maybe use closing entries.
CAclubindia
