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Cash credit journal entry

sayad (Executive) (203 Points)

10 February 2022

Hi can someone pls help me with journal entry for cash credit account in company book

1. For Interrest charged by bank every month on CC account

2. Opening balance of Cc account in company books of account

3 processing fees and cheque book charges by bank on Cc account

thanking you in advance

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3 Replies

prasad Nilugal ( GST Practitioner & Accounts ) (14801 Points)
Replied 10 February 2022

Interest on CC A/c Dr
To Bank A/c Cr
( Being Interest charged by the Bank for cash credit )

processing fees A/c Dr
To Bank. A/c Cr
( proceedings fees for CC account )

For cheque book charges you create ledger Bank charges A/c

Bank Charges A/c Dr
To Bank A/c Cr
( cheque book charges paid )

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prasad Nilugal ( GST Practitioner & Accounts ) (14801 Points)
Replied 10 February 2022

For Cash Credit Company has to give Stock in Hand , Trade Debtors . Trade Creditors etc to bank for Drawing power .Company Can withdraw as per Drawing power or sanction Limit Whichever is lower .