The reason is this is define contribution plan and the employer only obligation is to make agreed contribution. These agreed contributions are charged to expenses. And in this question the contribution are underpaid so employer will book accrual for balance. So the journal entry would be. Dr contribution exp (p&l) Cr contribution paid (bank or cash) Cr bal contribution pay able (Accrual)
Sir aaj to poora dekh k hi jau ga
Great Lecture. Made concise notes. Thank you Sir!
Thank you so much
Thanksss
What would be the accounting treatment for Termination Benefit
Sir where can i get part 2 of this lecture?
1:07:02 Why does total amount go to expense ? Contribution paid should be Plan asset
The reason is this is define contribution plan and the employer only obligation is to make agreed contribution. These agreed contributions are charged to expenses. And in this question the contribution are underpaid so employer will book accrual for balance.
So the journal entry would be.
Dr contribution exp (p&l)
Cr contribution paid (bank or cash)
Cr bal contribution pay able (Accrual)