Accounting entry

329 views 3 replies

Hi, Friends,

Please do suggest accounting entries to be passed in the situation explained below:

Our company has paid interest on loan to Financial Institution (vendor/lender) on 31.03.2020 and we've passed the following entries

01. Interest on loan A/c Dr                                       10 crs

                   To Loan from FI (Vendor/Lender) Cr                        10 crs

 

02. Loan from FI (Vendor/Lender) Dr                          10 crs

                    To Bank A/c Cr                                                    10 crs

 

Later our Subsidiary company requested us to adjust 4 crs out of 10 crs paid on 31.03.2020 towards settlement of over dues payable by Subsidiary company (Installment on Loan from the Same Financial Institution) to avoid becoming NPA ...

We did exactly what our Subsidiary company has requested and FI (Vendor/Lender) has also agreed to adjust 4 crs out of 10 crs paid by Us towards settlement of over dues of subsidiary company...

on 15.04.2020 Subsidiary company transferred the 4 crs to Our company

to close the books on 31.03.2020, what are the necessary entries that I've to pass.. please suggest..

 

 

Replies (3)

What really happens, the substance of the transaction depends upon the software your using i.e., if it allows contra account transaction reversals. Next, if you have paid the money as bank interest, it is non reversible. If the bank had allowed reversal, then reverse the last transaction with just 4 Crores. Then, while lending it to subsidiary, record this as intra group lending. Create a loan given to subsidiary journal if interest component is present, or, create a journal for cash transfer to subsidiary when the substance of the transaction does not fall under loan. 

Thank you friend,

we are using SAP FICO...

Thank you friend, we are using SAP FICO...

Read more at: https://www.caclubindia.com/forum/accounting-entry-547873.asp?offset=1
Thank you friend, we are using SAP FICO...

Read more at: https://www.caclubindia.com/forum/accounting-entry-547873.asp?offset=1
Thank you friend, we are using SAP FICO...

Read more at: https://www.caclubindia.com/forum/accounting-entry-547873.asp?offset=1#reply

Thank you friend,

we are using SAP FICO

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 20 June 2026
Articleship

RB KESHRI & CO

Mumbai

B.Com

View Details
Company
ARTICLESHIP 30 June 2026
Article Assistant or Paid Assistant

VIKAS VERMA & CO

New Delhi

Others

View Details
Company
25 June 2026
AUDIT MANAGER

JDAS & ASSOCIATES

New Delhi

CA

View Details
Company
22 June 2026
Finance Manager- Chartered Accountant

Triveni Turbine Limited

Bengaluru

CA

View Details
Company
ARTICLESHIP 24 June 2026
ARTICLE ASSISTANT

BHUPINDER SHAH AND COMPANY

New Delhi

CA Inter

View Details
Company
12 June 2026
Accounts & Taxation Executive

Winshine Financial Services

Mumbai

CA Inter

View Details
Company
24 June 2026
Senior Account (VA Client Operations)

Karbon Business

Bengaluru

CA Inter

View Details
Company
06 July 2026
C.A./CA Inter OR pursuing C.A./GST/Accounts/Audit/IT - Head

Arvindkumar Maniar & Co.

Rajkot

CA

View Details