A, B & C working as director at 'ABC Co Ltd'. Now they buy 3 car 1 for each. Car buy on loan and loan amount will pay by ABC Co Ltd. Now we need to account above entries so guide us.
Menu
What is the Accounting Treatment for the CAR buy by Company Owner on Loan & Company re-pay the loan?
Replies (1)
Cars are personal assets: Since the cars are bought by the directors for personal use, they are not company assets.
Company Repayemt of loan: When the company repays the loan, it's considered a perquisite (benefit) to the directors.
Tax Implications: The value of the perquisite may be taxable in the hands of the directors.
Accounting entries:
Loan repayment by company: Debit : Director's loan account or perquisite expenses (depending on accounting treatment) Credit: Bank/cash (for loan repayment)
Recent Topics :
- Representative assessee
- Investment Income as Business Income for Sec. 44AD
- In ITR 4 u/s 44ADA what amount we shoud show under
- Salary expenses how to treat
- Pos related issue
- Gift of unlisted shares to friend upon marriage
- Utilising Section 54(F) for capital gains reinvest
- GST ewaybill closure and Bill to ship to GST numbe
- TDS ON PARNTER INTEREST
- Share important chapters of ca inter costing
Related Topics :
CAclubindia
