what is the Journal entry for BANK GUARANTEE given by a bank
for our company? Giv an example.
Answers were Sorted based on User's Feedback
Answer / kevin makwana
Bank Guarantee is not entered in the books of accounts. As per Part 3 to Schedule VI of the Companies Act, 1956, BG should be shown by way of discloser as Contingent Liabilited in Annual Report of the Company. Hence No entry is passed at all.
|Is This Answer Correct ?||34 Yes||5 No|
Answer / revathy
when a party fails to make a payment to its debtor,the bank takes the risk to make the payment on behalf of the said party. This is called bank guarantee.But against the bank guarantee given by bank, the bank asks for an FD from the party which is pledged. No bank agrees to take a risk for someone without something assured from them.
|Is This Answer Correct ?||5 Yes||4 No|
Answer / auditya
generally there is no entry for BG in your books
and if required for the sake of records it may be
mentioned as a statement , but no entry will be passed
|Is This Answer Correct ?||6 Yes||7 No|
Answer / thomas
when a company introduces new brand, that particular new
brand company asks for bank guarantee that is called bank
|Is This Answer Correct ?||4 Yes||23 No|
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