intercompany accounting

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AMJAD KHAN (Querist)
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11 September 2010 In interview one manager ask me that if there are two company A & B, bill receivable by A on the behalf of Company B then what will be the journal entry in books of B Accounts and he ask what is intercompany Accounting.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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11 September 2010
In A company entry

Dr: Bill receivable
Cr: B Company

and

B company

Dr: A company
Cr: Bills receivable a/c

Inter company accounts mean 2 or more companies under the same managment having business and other transactions

Srinivas Rao

Srinivas Rao (Expert)
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11 September 2010 Agreed with CMA Ramesh, but the credit in the books of of Company B will be 'Bills Payable'.

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ravi taneja

ravi taneja (Expert)
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11 September 2010 IN THE BOOKS OF B

CO A A/C DR
TO B/P A/C

ravi taneja

ravi taneja (Expert)
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11 September 2010 WHEN THERE IS RELATIONSHIP OF SUBSIDIARY OR HOLDING THEN TRANSACTION BETWEEN THEM ARE HANDLED BY INTERCOMPANY ACCOUNTS.