Entries in the books of Hire Purchaser
§ Entry for recording credit purchase on asset
Asset A/c Dr
To Hire Vendor A/c
§ Entry for recording down payment at the time of agreement
Hire Vendor A/c Dr
To cash A/c
§ Entry for recording interest due
Interest A/c Dr
To Hire Vendor A/c
§ Entry for recording installment paid
Hire Vendor A/c
Dr
To Cash A/c
§ Entry for depreciation at the end of the year
Depreciation
A/c Dr
To Asset A/c
§ Entry for recording transfer of interest and depreciation to Profit & Loss A/c
Profit &
Loss A/c Dr
To Interest A/c
To Depreciation A/c
§ Entry for recording repossession of by the seller due to
non-payment of an installment
Hire Vendor A/c
Dr
To Asset A/c
§ Entry for recording loss on repossession
Profit &
Loss A/c Dr
To Asset
§ Entry for profit on repossession
Asset A/c Dr
To
Profit & Loss A/c
Entries in the books of Hire Seller
§ Entry for recording credit sell of goods
Hire Purchaser
A/c Dr
To Sales A/c
§ Entry for recording receipts on down payment
Hire Purchase A/c Dr
To Interest A/c
§ Entry for recording transfer of interest to Profit & Loss A/c
Interest A/c Dr
To Profit & Loss A/c
§ Entry for recording repossession of stock
Reposed Stock
A/c Dr
To Hire Purchase A/c
§ Entry for Expense incurred on repaying of reposed stock
Reposed Stock
A/c Dr
To Cash A/c
§ Entry for sale of reposed stock
Cash A/c Dr
To Reposed Stock A/c
§ Entry for transfer of Profit on reposed stock account
Reposed Stock
A/c Dr
To Profit & Loss A/c
§ Entry for transfer of loss for reposed stock
Profit &
Loss A/c Dr
To
Reposed Stock A/c
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