Letter of Credit

Is letter of Credit recorded under Bank as restricted cash or under current assets?

Assume the company has deposited the funds into a CD to get the letter of credit. What is the JE to book it?

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mmali1979

  • Mar 16th, 2010
 

Dr. to Bank Gurantee A/c

Cr. to  Particular Bank A/c.

Being Certain amount deposited in a bank  for bank Gurantee for certain time/period.


Once transaction finished pls reversal the same entry.

Dr. to Particular Bank A/c

Cr. To Bank Gurantee A/c

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