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AA-5-Bidding Documents Payment Entry

My Videos (Accounts Officer ) (717 Points)

29 March 2023

Hi Respected Members,

Please educate me on following:

We purchased a bidding documents from client thru pay order to bid for a project. How we will record it ? And what will be nature of this account ?

Thanks in Advance.

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2 Replies

Ayush (Executive ) (6760 Points)
Replied 29 March 2023

To record the purchase of bidding documents from the client

Debit : Bidding Document Expense account

Credit : Cash/Bank account.

The nature of this account would be an expense account since it represents a cost incurred to obtain the bidding documents.

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Dhruvish parikh (2 Points)
Replied 30 April 2024

I have made expense of bidding as of today, now i have to close my books of accounts but I dont want to book that expense today so that after acquisition in next financial year i can reliase at that time. Now the question is that can i do this, if yes then what accounting entry/practice shall I follow? Facts: cost for accquiring an investment or bidding has been made, but the investment will be made later.