Procedure For Posting A Transfer or contra entery To A Journal Account
what is Transfer or contra entery
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Transferring from one account to another,
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If there is a decrease in one account and an increase in another, it is a Contra entry
.
This indicates a change in the balance sheet
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The change in the asset account is caused by the regular operations of the company
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The change in the liability account is based on the terms and conditions applicable to that account
Do not record in the transaction about the transfer of goods within the company
Because such details the accountant will record the cost sheet
If the liability are transferable
If the assets are transferable
▶ $ 8000 was transferred from profit account to dividend account
▶ It is the transfer of liability so
# from debit profit account
# to credit dividend account
date | particular | amount | amount |
05/22/2021 | profit account D | 8000 | |
| to dividend account | | 8000 |
| transferred from profit account to dividend account | | |
▶
05/12/2021 The money was withdrawn from the bank
$2000
▶ It is the transfer of asset so
# to debit cash account
# from credit bank account
date | particular | amount | amount |
05/12/2021 | cash account D | 2000 | |
| to bank account | | 2000 |
| transferred from profit account to dividend account | | |
▶
05/22/2021 $ 2000 was transferred from profit account to revenue reserve account
$1200
▶ It is the transfer of liability so
# from debit profit account
# to credit revenue reserve account
date | particular | amount | amount |
05/22/2021 | profit account D | 2000 | |
| to revenue reserve account | | 2000 |
| transferred from profit account to revenue reserve account | | |
▶
The raw materials were sent to the manufacturing department for production
$800 (at $200 per unit)
try you are self and asked any qusting ?
- ► $2000 was transferred from revenue reserve account to dividend account
- ► $4000 was transferred from profit account to capital reserve account
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$200 were transferred from the depreciation account to the revenue reserve account
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