Hi to all!!!
As per accounting concepts we should account all incomes and expenditures as it occurs without any setting off of income against expenses or vice versa..
For eg: for sale of an asset -BV-4200, SV-4000,
we pass the entry as:
Cash/Bank a/c dr 4000
Loss on sale a/c dr 200
To asset a/c 4200
Well this treatment is correct.
Similarly I have a doubt! For instance Bank has charged his client wrongly and later finding out the mistake again credited it in the client's a/c. Like total Bank charges are Rs.1000 and wrongly debited bank charge now credited is Rs.100/-
1. Can the Client Pass entry only for Bank charge and credit of Bank Charge? OR
2. Can the client pass entry with setting off income from total Bank charges?
(a) Bank Charges a/c dr 1000
To Bank a/c 1000
(b) Bank a/c dr 100
To miscellaneous inc a/c 100
(c) Bank charges a/c dr 900
To Bank A/c 900
Can the client pass (a) and (b) or only (c)
Which is correct? Support your answer relating to accounting concept!!!!
CAclubindia
