Learnt about preparing bank account from bank statements.
Bank account may be of 2 types, it may be plain bank account or overdraft account. To discern it, study the deposit section of bank statement carefully. If on depositing, the amount balance increases, it is bank account, where as on deposit if account balance decreases then it is overdraft account. Prepare ledger account for bank keeping in mind the suitable under (.i.e overdraft or bank account).
In bank statements, there are 2 types of dealings.
1. Deposit.
2. Withdrawal.
For deposit, there is no complexity as always contra voucher will be used and entry will be
Bank a/c dr
To cash
For withdrawal,
A couple of cases arises.
1. When withdrawal is for paying a known creditor.
Payment voucher is used
Sundry creditor a/c dr
To Bank
2. Payee not specified.
Contra voucher is used
Cash a/c dr
to Bank
Dont forget to give cheque number in narration for withdrawals.
Bank account may be of 2 types, it may be plain bank account or overdraft account. To discern it, study the deposit section of bank statement carefully. If on depositing, the amount balance increases, it is bank account, where as on deposit if account balance decreases then it is overdraft account. Prepare ledger account for bank keeping in mind the suitable under (.i.e overdraft or bank account).
In bank statements, there are 2 types of dealings.
1. Deposit.
2. Withdrawal.
For deposit, there is no complexity as always contra voucher will be used and entry will be
Bank a/c dr
To cash
For withdrawal,
A couple of cases arises.
1. When withdrawal is for paying a known creditor.
Payment voucher is used
Sundry creditor a/c dr
To Bank
2. Payee not specified.
Contra voucher is used
Cash a/c dr
to Bank
Dont forget to give cheque number in narration for withdrawals.
