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- This topic has 3 replies, 2 voices, and was last updated 7 years ago by John Moffat.
- AuthorPosts
- May 21, 2017 at 6:55 pm #387299
Dear Sir,
Greetings of the day!
I have a question to ask regarding the topic “JOURNAL”. The journal is used to keep a record of unusual movements between accounts.
Thus, if a business made a payment by wired method from one account to another of $2,000.00 and there are bank intermediate charges of $15.00.
Should the account be debited by bank charges of $15 and credit the customer’s account of $15?
Thank you for your answer.
May 21, 2017 at 7:39 pm #387318Not all businesses these days keep a journal – it is rather old-fashioned and is not really necessary now that most accounting is done on computers.
For the payment of $2,000, the entry is credit cash and debit the supplier.
For the bank charges of $15, it depends on who the bank is charging! If the company doing the paying of the 2,000 has to pay, then the entry is credit cash and debit bank changes expense account. If the person receiving the money is who is being charged, then there is no entry in our books (because we did not have to pay anything).
May 21, 2017 at 7:56 pm #387326Many thanks for your answer. I just forgot to clarify more; if the company charges a customer 2,000/- and the customer made a payment with wire payment method, a bank charged us 15/- thus in the bank account a company received 1,985.00, how would i record this as my transaction as journal entry?
Thank you
May 21, 2017 at 8:28 pm #387328For the initial invoice, you debits receivables and credit sales with 2,000.
When the cash is received you debits cash and credit receivables with 1985.
What happens next depends on what was agreed with the customer regarding the banks charges,
If we agreed to pay them then debit bank charges and credit receivables,
If the customer is to pay them, then do nothing because there will still be able balance owing from them of 15 on receivables. - AuthorPosts
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