transfer

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arun (Querist)
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05 January 2010 sir i have handled two company 1st company having bank a/c and 2nd company not having bank a/c. so iwill payment in 1st companies creditor in 2nd company bank a/c. so what will be transfer entry in our both book.

Zeeshan

Zeeshan (Expert)
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05 January 2010 In Ist Company's Books (which is making payment):

At the time of payment
IInd Company A/c Dr.
To Bank A/c

while recieving cash from second company:
Cash account Dr.
to IInd Company A/c
*donot take cash exceeding 20000/-in a single day.

In Second company books:
at the time of payment by Ist company:-
Expenses/Creditors A/c Dr.
To Ist company A/c

at the time of reimbursement by II company to I company:
I company A/c Dr.
to Cash A/c
*donot pay cash exceeding 20000/-in a single day.