Journal Voucher for Advance Transactions

Subject: Other

Find Your Query

Overview

Advance is an amount, which is given to official staff and other parties before receiving goods and services. It is given to perform a specific task. After the completion of such task, the advance amount should be cleared. This note has information about the journal voucher prepared for advance transactions.
Journal Voucher for Advance Transactions
.

An advance is an amount, which is given to official staff and other parties before receiving goods and services. It is given to perform a specific task. After the completion of such task, the advance amount should be cleared. Under new accounting system, the record of advance is made twice as follows:


Journal voucher at the time of giving advance

An advance is given to an official staff or to another party to make expenditure on the related budget head. When the advance is given the party receiving the advance with the related budget head is debited and Nepal Rastra Bank is credited. The journal voucher at the time of giving advance is passed as follows:
Dr. Name and post of the receiver
Advance for ..... (Budget head)
Cr. Nepal Rastra Bank
(Being advance given to Mr. .....for the purchase of ......)

Nepal's Largest Virtual Event Abroad Studies Opportunities


Journal voucher at the time of clearing advance

The amount of advance, which is given to perform the specific task, should be cleared after its completion. It is cleared after the submission of necessary bills and documents. The amount of expenditure may be equal to the advance, less than the advance or more than the advance amount. The following are the five conditions to clear the advance:

  • When the amount of expenditure is equal to the advance
    When the amount of bill of expenditure remains equal to the amount of advance given, the following journal voucher is passed for clearing the advance:
    Dr. B.E. Name of the Budget Head
    Cr. The Name and Post of the person
    Clearance of advance for.......
    (Being advance for ...... cleared)

  • When the amount of expenditure is more than the advance
    If the amount of expenditure is more than the advance given, the excess amount of expenditure is paid through cheque. The following journal voucher is passed for clearing the advance:
    Dr. B.E. Name of the Budget Head
    Cr. The Name and Post of the person
    Clearance of advance for.......
    Cr. Nepal Rastra Bank
    (Being advance for ...... cleared by issuing a cheque for excess amount of expenditure)

  • When the amount of expenditure is less than the advance
    If the amount of expenditure is less than the advance given, the surplus amount is returned to concerned office or deposited in the bank. The following journal voucher is passed for clearing the advance:
    Dr. B.E. Name of the Budget Head
    Dr. Nepal Rastra Bank
    Cr. The Name and Post of the person
    Clearance of advance for.......
    (Being advance for ...... cleared and surplus amount is returned)

  • When the whole amount of the advance is returned
    Sometimes, the party may fail to perform the assigned job. In such condition, the whole amount of advance should be returned to the office. The following journal voucher is passed for clearing the advance:
    Dr. Nepal Rastra Bank
    Cr. The Name and Post of the person
    Clearance of advance for.......
    (Being advance for ...... cleared by returning the amount of advance)

  • When the partial clearance is made
    Sometimes, the party who has taken the advance may clear the advance partially. The following journal voucher is passed for clearing the advance:
    Dr. B.E. Name of the Budget Head
    Cr. The Name and Post of the person
    Clearance of advance for.......
    (Being advance for ...... cleared partially)
Things to remember
  • Advance is an amount, which is given to official staff and other parties before receiving goods and services.
  • An advance is given to an official staff or to other party to make expenditure on the related budget head. 
  • The amount of advance, which is given to perform the specific task, should be cleared after its completion. 
  • If the amount of expenditure is less than the advance given, the surplus amount is returned to concerned office or deposited in the bank. 
  • It includes every relationship which established among the people.
  • There can be more than one community in a society. Community smaller than society.
  • It is a network of social relationships which cannot see or touched.
  • common interests and common objectives are not necessary for society.
Questions and Answers

An advance is an amount, which is given to official staff and other parties before receiving goods and services. It is given to perform a specific task.

Solution:

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. Storekeeper Mr. Shankar Sharma

Advance for office furniture purchase

29311

10,000

Cr. Nepal Rastra Bank

10,000

(Being advance given to storekeeper Mr. Shankar Sharma for the purchase of office furniture through cheque no. 00037.)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. BE Office furniture

29311

40,000

Cr. Store keeper Mr. Shankar Sharma

40,000

Clearance of the advance for the purchase of office furniture

(Being advance of Mr. Shankar Sharma for the purchase of office furniture cleared.)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. Petty cash fund

3,000

Cr. Nepal Rastra Bank

3,000

(Being cheque issued to create petty cash fund and handed it over to accountant Shyam Raut.)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. Section Officer Sarita Puri

12,000

Cr. Nepal Rastra Bank

12,000

(Being advance given to section officer AreshPuri through cheque)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. Storekeeper K. Pradhan

Advance for purchase of office furniture

29311

1,20,000

Cr. Nepal Rastra Bank

1,20,000

(Being advance given to storekeeper K. Pradhan for the purchase of office furniture.)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. BE Office Furniture

29311

1,25,000

Cr. Storekeeper K. Pradhan

Clearance of advance for the purchase of office furniture

1,20,000

Cr. Nepal Rastra Bank

5,000

(Being advance for the purchase of furniture cleared.)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. Accountant Prem Shrestha

Advance for the purchase of computer

29511

35,000

Cr. Nepal Rastra Bank

35,000

(Being advance given to Prem Shrestha for the purchase of computer.)

Code No.

Particulars

LF

BH No.

Debit Rs.

Credit Rs.

Dr. BE Computer

29511

35,000

Cr. Accountant Prem Shrestha

Clearance of advance for the purchase of computer

35,000

(Being advance cleared by Accountant Prem Shrestha for the purchase of computer.)

Quiz

© 2019-20 Kullabs. All Rights Reserved.