What is the nature of Bills Receivable account, I mean is
it a real account or personal a/c?
Answer Posted / mohit pathak
Both B/R and B/P are personal A/cs… To be more apt, they are Representative Personal A/c
Why??
Both these accounts represent Debtors or creditors of a particular entity.
The rule followed to pass entry in such cases is:
Dr. the receiver of the benefit
Cr. The giver of the benefit.
In the above rule ,the inner meaning of rule. Suppose when B/R is issued, it’s Dr. because that B/R represents Debtor from whom money is receivable... In a way our entity has given those debtors a benefit i.e. credit so as per rule we Dr. B/R a/c( at the time of issue).
Similarly B/P which is issued against creditors and it represent the liability towards creditors... It’s credited because Creditors have given us the benefit i.e. credit. So we Cr. B/P A/c(at the time of issue)
To be more clear and to the point, Both B/R and B/P cannot be Real A/c… Real a/c applies to assets of an entity.. These B/R and B/P are not assets because they are not yet acquired as like Plant, building etc. They are yet to be encashed. Asset means which has been acquired and has some value.
Hence, Bills Receivable and Bills Payable are Representative Personal A/cs.
Hope you have understood. If not, ask again without hesitation.
Is This Answer Correct ? | 134 Yes | 30 No |
Post New Answer View All Answers
Took goods from the shop for use at home. state whether the the following transcation is business transcation or non business transcation? with reson or explaination?
Cost center 60500 in controlling area 1000 is locked for revenue postings on 31.03.2008.Now How can I Assign the account to another cost center or allow cost center 60500 to again accept revenue postings.
What do you know about hyd? Tell something about hyd?
if we have credit 50 % rg23c part ii first and not credit next balance 50 % .when we have do?
Country-Western songs emphasize three basic themes: love, prison and trucks. A survey or the local Country-Western radio station produced the following data: 12 songs about a truck driver who is in love while in prison 2 about people in prison who are not in love and do not drive trucks 8 about people who are out of prison, are not in love, and do not drive a truck 13 about a prisoner in love 28 about a person in love 18 about a truck driver in love 16 about truck drivers who are not in prison 3 about a truck driver in prison who is not in love Find the number of songs about: a) How many songs were surveyed? b) truck drivers? c) prisoners? d) truck drivers in prison? e) people not in prison? f) people not in love?
How can I explain p2p process in SAP?
My BASIC Salary is 18,000
purchase car from toyota innova 50000 cheque from one firm and 449893 from other firm.... and 1350000 loan saction from kotak mahindra.....how can entry make with interest
what is the meaning of call in arear
How to raise my credit score if I have 500 credit score?
What goals do you have in your career
Expand-------ASRT
How & When We Calculate Deffered Tax... Please Give me Some Example.?
How to answer for the question, tell me about ur project? I mean in which format can i say?
how to prepare HSD statements in tally