12 November 2009
if advances have been received from clients and no bills have been raised yet. How can they be adjusted if the bills are not to be raised. Is this a correct practice by a company?
13 November 2009
Hi Preeti, it is very common to receive advances from clients. at the time of receiving advance, the following entry will be passed : Cash/Bank A/c Dr. To Advances from clients A/c when the bills will be raised in future, these advances will get adjusted against outstanding balances of the clients and balance only will appear as debtors. If no bills are raised in future, then this amount becomes refundable to the clients. Thanks and regards, CA Shakuntala Chhangani
CAclubindia
