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Entry of Cheque in hand on 31st March

Dev K Sharma (Learning Thru Experience) (157 Points)

09 June 2011

AT 31st of March ' 2011 (FY 2010-2011) Sundry Debtors Outstanding is 11,00,000.00, out of those I have cheque in hand of Rs. 7,00,000.00 ( 200000/- of 3.04.2011, 200000/-, of 08/04/2011 & 300000/- or 12/04/2011 ).

My Question is do i have to create and Debit cheque in hand account under (C/Assets) and Credit he debtors account,

and show the balance as on 31st of Rs. 400000/- or i have to just show Debtors balance of Rs. 11,00,000/- on 31st and credit the in the next financial year( Date of Cheque)

Awaiting for your valuable reply..... Thanks .....

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24 Replies

rachit jain (chartered accountant ) (635 Points)
Replied 09 June 2011

you have to show it as debtors.

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CA AMANPREET SINGH (Chartered Accountant) (284 Points)
Replied 09 June 2011

there is no need to make any adjustment as on 31st march. it will be adjusted for next financial year

1 Like

CA ADITYA SHARMA (CA IN PRACTICE ) (16719 Points)
Replied 09 June 2011

Originally posted by : rachit jain
	you have to show it as debtors.

agred

CA Pankaj Goel (Self Employed) (74 Points)
Replied 10 June 2011

I agree with Amanpreet.

You should show Total debtors as Rs. 11 lacs on 31st march, 2011 and furhter can make entry of cheques recived from debtors.

CA Navin Jain (MANAGER (FINANCE & ACCOUNTS)) (11768 Points)
Replied 10 June 2011

The practice followed by the company to recognise
the cheques bearing date of 31st March or
before, though received after 31st March as
‘cheques-in-hand’ in the financial statements for
the period ending on 31st March is not correct

SEE THE ATTACHMENT

Attached File : 69552 736433 cheque.pdf downloaded: 2125 times

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CA Mahesh (...) (70 Points)
Replied 10 June 2011

Hi..

Dev K Sharma

u have to show it as a detors balance as on 31st March.

Aparna Raja K.C (Student) (520 Points)
Replied 10 June 2011

Originally posted by : AMANPREET SINGH
	there is no need to make any adjustment as on 31st march. it will be adjusted for next financial year

Agree...:)

Balasubramani (Senior executive) (90 Points)
Replied 11 June 2011

Hello Sharma,

Mr. Naveen jain only give the correct updation to you. please follow the same.

As on 31st march you have debetors balance Rs.11.00 Lakhs. Your cheque dates on after 31st march.

1) Post dated cheques not valid in your AD.

2) In case your cheques as discounted before 31st march you take care of discounting entries in your ledger.

Regards

V.Bala

CMA. Rakesh Kataria (Practising Cost Accountant) (536 Points)
Replied 11 June 2011

Mr. Navin Jain has advised correctly, need to follow the same.

ramesh (FINANCIAL ANALYST) (46 Points)
Replied 12 June 2011

I think that reply given by Mr. Jain is irrelavent in the context. The question pertains to post dated cheques.

As per NI Act, Post dated cheques are not vaild.

Hence the cheques which are dated after BS date, even though received before before BS date dont require any adjustment.

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(Guest)

Hi Ramesh, I guess there is nothing irrelavant in the text of Jain... read fully the file given by Jain once again....

Simple funda here - As per the accounting policies we never recongnise future receipts.... we cannot know on those post dates money may not be available in those accounts and may be checks bounce , so how can we estimate that... On cash basis if we see we recongnise only on the receipt of cash......

Correct me if i am wrong......

Thank you.