⛌

Procedure For Posting A Transfer or contra entery To A Journal Account

what is Transfer or contra entery

♟ Transferring from one account to another,
♟ 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
♟ The change in the asset account is caused by the regular operations of the company
♟ 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

▶ 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

▶ 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

▶ 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

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
► $200 were transferred from the depreciation account to the revenue reserve account

topics