Why we won't write person name in opening entry,
For example, Gopal started a business with cash 5000rs/-
entry will be
Cash A/c Dr
To Capital A/c
Why we won't write
Cash A/c Dr
To Gopal A/c
Thanks in advance
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Why we won't write person name in entry
Replies (5)
Because in academics ,
gopal Could be your customer who is paying you money
or
he could be your supplier who is giving advance to you
gopal Could be your customer who is paying you money
or
he could be your supplier who is giving advance to you
the reason is if owner is initializing capital introduction and if u go with ur "name" entry than it wud mean like -
1. sm1 named gopal has given money to u
2. owner and busines ll be separatly considered (in case of proprietorship firm)
1. sm1 named gopal has given money to u
2. owner and busines ll be separatly considered (in case of proprietorship firm)
The business entity personal entity is different. Generally we do not write our name in our business books. We write other names to easily identify. For example In partnership business we writer partners capital account with their names for easilty identity purpose.
Debit all Assets
Credit All Liabilities
By this way, the balances of all ledgers can be carried forward
For Vistt:-https://www.profsindia.com/topic/opening-entry/#post-7301
Debit all Assets Credit All Liabilities By this way, the balances of all ledgers can be carried forward For Vistt:-https://www.profsindia.com/topic/opening-entry/#post-7301
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