entry of cheque purchase

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seema singla (Querist)
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20 May 2010 A co. purchased a cheque from a bank. What entry it should pass in its books on purchase of cheque as well as on the payment of it to the bank????

Ram Avtar Singh

Ram Avtar Singh (Expert)
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20 May 2010 suppose cheque for rs. 100000

Bank account Dr 99500 (credited by bank)

Bank expenses Dr 500

Party account Cr 100000

CA Shiv

CA Shiv (Expert)
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20 May 2010 what you mean by purchase of cheque.. You mean cheque book?
if yes than
bank charges to bank ac.

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Ram Avtar Singh

Ram Avtar Singh (Expert)
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21 May 2010 Sum time a cheque recd from party will take one or more days in clearing we want money same day. we purchase cheque from our banker. and get money immediate by paying few charges to bank.