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Sundry Creditors

Devendra (Chartered Accountant) (4775 Points)

10 July 2010

What are the possibilities of Sundry creditors having Debit balance?

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7 Replies

Ashish Ojha (Chartered Accountant) (469 Points)
Replied 10 July 2010

Creditors are personal accounts, eg Ram, Shyam etc... now if we make excess payment to Creditor Ram, or sell goods to Ram of more value than waht we have borrowed, or give loan to him after returning..

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Devendra (Chartered Accountant) (4775 Points)
Replied 10 July 2010

what if bills might have not been recorded against the payments made to the creditor. Even in this case it will show a Dr. balance.. right?

janak (post graduation) (1327 Points)
Replied 10 July 2010

ya...if u have not made payment to creditors.....then, there may be the Dr. balance of Creditors.

Example:Purchases return......in this case,it will reduced the liability of the purchaser against the creditors or may show the dr. balance.................

i hope ,u would get it....

regards:janak

Kapil (ds) (92 Points)
Replied 10 July 2010

Hi Devendra...

i wud like to mention following broad reason for a creditor to have debit balance.

1. advance payment

2. debit note not entered in our books.

3. purchase return (where subsequent payment not yet settled)

4. non refundable deposit obtained.(not properly accounted for)

hope that above explanation helps u...

Mayank Saraogi (Learner) (170 Points)
Replied 11 July 2010

n excess payment but only when trading with the party is very often and the payment is given at different stages by combing one or more bills

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(Guest)

Originally posted by : Kapil
	Hi Devendra... i wud like to mention following broad reason for a creditor to have debit balance. 1. advance payment 2. debit note not entered in our books. 3. purchase return (where subsequent payment not yet settled) 4. non refundable deposit obtained.(not properly accounted for) hope that above explanation helps u...