[hash_in]

Hello Friends,

Last week I faced an interview for accountant post. In that I was asked to pass an entry for post dated cheque. What is the answer for this queston?


Thank You

[CaptainForest]

You would not make a journal entry for a post dated cheque.

Just a note to the financial statements.

The journal entry would come when the cheque is cashed.

[papiasarkar]

The journal entry should come at the time of deposit of receivable PDC. Account should be PDC receivable... Dr
To Deferred Income
On the due date means at the time of cashed accounting should be
Cash/bank... Dr
PDC Receivable
Deferred Income... Dr
Actual Income

If any body have any comments please carry on.

Thanks.

Papia

[ssankarganesh]

Hello Freinds,

Last week I faced an interview for accountant post. In that I was asked to pass an entry for post dated cheque. What is the answer for this queston?


Thank You

You can pass a entry in the current year by passing an entry like this

Debit Party in favor of cheque
Credit Cheque in Transit

Cheque in transit is a contingent liability. I think you know well about contingent liability otherwise it is a liability for us and we have to meet out.

[pooja09]

Entry should be today when cheque received
Cash a/c dr.
To debtor
And when date is come
Bank a/c dr
To cash

[Sagarsam]

Actually papiasarkar right

By Bank A/c Dr.
To PDC receivable A/c Cr.


Thanks papiasarkar

[isagani]

Postdated check are Contingent Liability and it doesn't need any entry only disclosure as per IAS 37. But in order to monitor the post dated check in the book you will prepare an entry as zero effect it means a debit to Deferred asset and a credit to Deferred liability, and you will going to reverse it by realizing the post dated check as per the definition of Current Asset (Cash and Prepayment) in IAS 1. It means you will just need to reverse the entry you made when you issued the postdated check and issue an entry as Debit to Prepayments and Credit Cash. If you have system it will come automatic, and it will be more easier.

[titusannie]

Entry should be today when cheque received

PDC Received A/c Dr

To Debtors ( Party - Customer)

And when date is come

Bank A/c Dr

To PDC Received

Thanks & regards
Titus C Mani

[titusannie]

Entry should be today when cheque Issued

Party (supplier) A/c Dr
To PDC issued

And when date is come

PDC issued
To Bank



Thanks & regards
Titus C Mani

[paraclete]

Apparently there are many thoughts on this

A post dated cheque is really a promisary note falling due at a future date, no different from any other long dated financial instrument. It is therefore a current liability or a long term liability depending upon the due date

Assuming the original liability is recorded in accounts payable
Debit Accounts Payable and credit Deferred Liabilities

[Salimkentt]

In that case , will it not increase the Credit of this customer without having physical payment?
Eg. Customer has 3000 USD credit in which he used 1000 USD and giving a PDC today for the date 11 Dec. if We record this, the customer credit will increase and it may be used for further purchase before the realization of the Cheque.