What will be the journal entries for business purchases paid

Business Strategist

What will be the journal entries for business purchases paid from designated partner's bank account in a LLP? What will be the journal entry when he will reimburse the amount from LLP's bank account?

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After LLP registration, one of the crucial requirement for running the business smoothly is accounting process. For the transaction asked for the entries can be recorded as follows:

  1. Purchase made from Designated Partner’s Bank Account

Purchase Account or Asset Account shall be debited excluding the amount of Tax. CGST/SGST/IGST Account shall be debited. An Account called “(Name of Designated Partner) Loan shall be credited.

2. Entry on reimbursement

The account of “(Name of Designated Partner) Loan” shall be debited with the amount reimbursed and Bank account shall be credited with the same amount.


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