Phrases related to checks
In the following article, we have explained some things in the field of checks for you friends.
Accounting records for cashing checks
What does cashing a check mean?
We take the received check directly to the bank and cash it. This money actually enters the company’s fund, whose document registration is as follows:
Cash balance and bank / fund (bad)
Accounts and documents receivable / documents receivable with the fund (BS)
If we deposit the money into our account, another stage of issuing a document is necessary, in which our bank becomes a debtor and our fund becomes a creditor.
Accounting records for depositing checks
What does it mean to deposit a check?
If we deposit the check directly into our account instead of cashing it, we will record this step and issue the following document:
Accounts and documents receivable / documents receivable in the process of collection (bad)
Accounts and documents receivable / documents receivable with the fund (BS)
Accounting records for handing over checks
What does giving a check to others mean?
Here, we hand over the received check to a third party for a debt or another matter and spend the so-called check. Its document registration is as follows:
Trade Accounts Payable/Trade Creditors (Bad)
Accounts and documents receivable / documents receivable with the fund (BS)
Instead of the first row, personnel or current salaries of partners, etc. can be recorded.
Registration of the accounting document for the return of the entrusted check
What does the returned check mean?
If the check is returned to its owner for any reason, such as lack of balance or a broken transaction, this step is recorded and its document registration is just the opposite of the step of receiving the check.
Registration of the accounting document of check passing
What does a check pass mean?
If the deposited check is received in the bank account and deposited into the bank account, the check passing stage is recorded. Issuance of the check passing document is as follows:
Cash and bank balance / detailed banks (bad) accounts and receivables / receivables in the process of collection (good)
Accounting registration of payment documents
All the above explanations were about checks received. If a check is issued by the company for work, it is called a check or documents payable. For this type of check, several steps are recorded, which are:
Issuing checks and handing them over to others, collecting checks, returning checks
Registering the accounting document for issuing checks and assigning them to others
In this step, the details of the check are entered into the system as in the previous step, and the person to whom the check is to be given is specified. Issuance of the document is as follows:
Commercial Accounts and Payable Documents / Detailed Commercial Creditors (Bad)
Commercial Accounts and Payable Documents / Commercial Payable Documents (BS)
The debit side of the document can be changed according to the purpose for which we gave the check.
Accounting registration of check collection
What does check collection mean?
As soon as the check is cashed and its funds are withdrawn from the bank account by the customer or check holder, the check enters the passing stage and its document is recorded as follows:
Accounts and commercial payable documents / Commercial payable documents (bad)
Cash and bank balance/bank details (BS)
Check return accounting registration
What does check return mean?
When, for any reason, the assigned check is returned to the customer, the return stage of the check is recorded and its document is exactly the same as item 1.
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This post is written by Shadiiii_77