Lic premium entry
ABHI KUMAR (710 Points)
15 July 2021
lic premium every year we pay now entry plz and after maturuty entry plzzz
12 Replies
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 15 July 2021
Lic premium a/c dr
to Bank a/c
Bank a/c dr
to Lic maturity proceeds a/c
to Bank a/c
Bank a/c dr
to Lic maturity proceeds a/c
prasad Nilugal
(3914 Points)
Replied 15 July 2021
1) Show LiC premium under Indirect Expense in Profit and Loss Account when you pay .
2) And Show under Indirect Income when you receive after maturity .
2) And Show under Indirect Income when you receive after maturity .
Ankita Jain
(CA in practice)
(185 Points)
Replied 15 July 2021
LIC premium paid is a personal expenditure. It is passed through capital account.
prasad Nilugal
(3914 Points)
Replied 15 July 2021
Yes , But paid by the company in the benefits of the employee will be Revenue Expenditure and accordingly I answered .
It is not clear in the query , paid by whom .
It is not clear in the query , paid by whom .
prasad Nilugal
( GST Practitioner & Accounts )
(14801 Points)
Replied 15 July 2021
If it is paid by the sole proprietor then entry will be
1) Capital A/c Dr
To Lic Premium A/c Cr
( Being personal premium paid )
2) After maturuty receipt entyr will be
Bank A/c Dr
To Capital A/c Cr
( Receipt of LIC maturuty amount )
prasad Nilugal
( GST Practitioner & Accounts )
(14801 Points)
Replied 15 July 2021
Of course first entry in case of Sole proprietor wil be
Lic Premium A/c Dr
To Bank A/c Cr
( payment made )
Then transfer to capital account
prasad Nilugal
(3914 Points)
Replied 19 July 2021
Mr Sourav
You only said Yes , so above entry correct or not ?.
You only said Yes , so above entry correct or not ?.
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 19 July 2021
Yes entry is correct after entry lic amount should be transferred to capital account
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