when does accounts receivable have a credit balance?
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Answer Posted / preet bedi
Accounts receivables are sundry debtors and usually have a debit balance.Now sometimes debtor fails to pay his amount partially or completely.The amount of debt which cannot be recovered from the debtor is called bad debt,now bad debts needs to be written off by passing following journal entry
Bad debts account Dr.
To sundry debtors
so sundry debtors shows credit balance.
Note: it is the entry posted in adjustment in final accounts.
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my boss (Managing Partner of a firm) promoted along with his wife a private limited company. he and she spent some Rs. 75,000/- (approx) for the promotion of the company. i know that they usually fall under the head of preliminary expenses. but after receiving the certification of incorporation of the company how shall i repay them to the promoters i.e. what is the accounting entry in the books (initial books of accounts) for the expenditure incurred. they have kept in hand 5,00,000/- each to meet the expenses and they were allotted shares of equal to the amount. can i allot shares for a consideration of cash from and excluding the preliminary expenses. can i take cash towards the share application money (being the cash more than Rs. 20,000/-) as the company has not opened a bank account yet. please give me the detailed answer with journal entries that can be entered in tally. thank you.
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