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Journal Voucher | Advance Given | Clearance of Advance

Arjun EP

Published on: June 27, 2021

Advance Given | Clearance of Advance | Advance and Clearance

Generally, all the financial transactions cannot complete during one financial year.

For some official purpose, some amount is given to office employee or firm as advance.

It is must be budget expenditure.

Then that person or firm submits bill for advance.

That bill may be more or less than advance amount.

There are different methods for advance and advance cleared; they are:

1. Advance given

2. Submitted expenses bill equal to advance

3. Submitted expenses bill less than advance

4. Submitted expenses bill more than advance

5. Advance amount returned due to cancelled

6. Partially advance cleared etc.

Types of Journal Vouchers | Types of General Journal Vouchers

Under new accounting system of Government of Nepal, journal vouchers are classified into following three categories; they are:

(A)	Journal voucher for expenditure transactions
(B)	Journal voucher for advance and clearance of advance transactions
(C)	Journal voucher for miscellaneous transactions:
	(a)	Revolving or imprest fund released
	(b)	Budget release
	(c)	Salary and its deduction
	(d)	Establishment of petty cash fund
	(e)	Security deposit
	(f)	Budget transfer
	(g)	Inter office loan
	(h)	Rectification of errors
	(i)	Annual accounting closing

1. Advance is given

When advance amount is given to the office staff, he/she is debited.

DTCO is credited.

Journal Voucher

SN	Code	Activities	Particulars	LF	Sources				Debit	Credit
	Sub-head	Program			Level	Bearer	Type	Payment	Amount	Amount
	No.	Code No.				Orgⁿ		mode
			Dr Mr ABC						xxxx
			(Advance for ………)
			Cr DTCO single account							xxxx

Total									xxxx	xxxx
Amount in words:
Brief narration of transaction: advance given to Mr ABC for ……)

2. Submitted expenses bill equal to advance (Expenses = Advance)

When advance is cleared by the office staff, he/she is credited.

Advance cleared item (office materials or assets) is debited as Dr BE Expenses by name

Journal Voucher

SN	Code	Activities	Particulars	LF	Sources				Debit	Credit
	Sub-head	Program			Level	Bearer	Type	Payment	Amount	Amount
	No.	Code No.				Orgⁿ		mode
	xxxxx		Dr BE Expenses by name						xxxx
			Cr Mr ABC							xxxx
			(Advance cleared)

Total									xxxx	xxxx
Amount in words:
Brief narration of transaction: advance cleared by Mr ABC for ……)

3. Submitted expenses bill less than advance (Expenses < Advance)

When advance is cleared by the office staff, he/she is credited.

Advance cleared item (office materials or assets) is debited as Dr BE Expenses by name

Different amount is debited as Dr DTCO or Cash

Journal Voucher

SN	Code	Activities	Particulars	LF	Sources				Debit	Credit
	Sub-head	Program			Level	Bearer	Type	Payment	Amount	Amount
	No.	Code No.				Orgⁿ		mode
	xxxxx		Dr BE Expenses by name						xxxx
			Dr DTCO single account						xxxx
			Cr Mr ABC							xxxx
			(Advance cleared)

Total									xxxx	xxxx
Amount in words:
Brief narration of transaction: advance cleared by Mr ABC for ……)

4. Submitted expenses bill more than advance (Expenses > Advance)

When advance is cleared by the office staff, he/she is credited.

Advance cleared item (office materials or assets) is debited as Dr BE Expenses by name

Different amount is credited as Cr DTCO or Cash

Journal Voucher

SN	Code	Activities	Particulars	LF	Sources				Debit	Credit
	Sub-head	Program			Level	Bearer	Type	Payment	Amount	Amount
	No.	Code No.				Orgⁿ		mode
	xxxxx		Dr BE Expenses by name						xxxx
			Cr DTCO single account							xxxx
			Cr Mr ABC
			(Advance cleared)

Total									xxxx	xxxx
Amount in words:
Brief narration of transaction: advance cleared by Mr ABC for ……)

5. Returned of advance without any expenses

Sometimes, advance amount is returned without any expenses.

There are different reasons for this; one of them is cancellation of tour or buying.

Here, advance given amount comes back.

Dr DTCO signal account

Cr Mr ABC (advance cleared)

Journal Voucher

SN	Code	Activities	Particulars	LF	Sources				Debit	Credit
	Sub-head	Program			Level	Bearer	Type	Payment	Amount	Amount
	No.	Code No.				Orgⁿ		mode
			Dr DTCO single account						xxxx
			Cr Mr ABC							xxxx
			(Advance cleared)

Total									xxxx	xxxx
Amount in words:
Brief narration of transaction: advance cleared by Mr ABC for ……)

6. Clearance of advance partially

Sometimes, advance amount is cleared partially or installment basis.

This may happens for large amount and takes more time to complete the work.

Dr BE Expenses by name

Cr Mr ABC (advance cleared partially)

Journal Voucher

SN	Code	Activities	Particulars	LF	Sources				Debit	Credit
	Sub-head	Program			Level	Bearer	Type	Payment	Amount	Amount
	No.	Code No.				Orgⁿ		mode
	xxxxx		Dr BE Expenses by name						xxxx
			Cr Mr ABC							xxxx
			(Advance cleared partially)

Total									xxxx	xxxx
Amount in words:
Brief narration of transaction: advance cleared by Mr ABC for ……)
*Note:* this entry is repeated till advance is cleared

Keep in Mind (KIM)

if cash returned, it is deposited into bank or DTCO

Dr DTCO single account

Cr Cash

(Being – cash deposited into bank)

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = ₦ = Birr = Currency of your country

PROBLEM: 3A

District Judicial Court, Nawalparasi has following information:

2078 Bhadra 10: Advance paid to Advocate Mr Gopal for field allowance Rs 10,000 to go to Kathmandu.

Required: Journal Voucher for following conditions:

1. Advance given to Mr Gopal

2. Mr Gopal submitted bill for Rs 10,000.

3. He submitted bill for Rs 8,000 and bank voucher Rs 2,000.

4. He submitted bill for Rs 13,000.

5. He returned Rs 10,000 due to tour cancelled.

6. He submitted bill of Rs 5,000 and settled partial clearance.

[Answer: (c) Debited DTCO = Rs 2,000; (d) Credited DTCO = Rs 3,000]

SOLUTION:

1. Advance is given to advocate Mr Gopal for field allowance

It means amount issued in his name for field allowance to go to official work.

AGF No. 203

Central/Province/Local Level

Government of Nepal

District Judicial Court, Nawalparasi

Date: 2078–05–10

Office Code No. 52

JV No. 1

Journal Voucher

Electronics Transaction No.

Types of Journal Voucher: Payment

Budget Sub-head No.

Code

Activities

Particulars

Sources

Debit

Credit

Sub-head

Program

Level

Bearer

Type

Payment

Amount

No.

Code No.

Orgⁿ

mode

Dr Advocate Mr Gopal

10,000

(advance for field allowance)

Cr DTCO single account

10,000

Total

10,000

Amount in words: ten thousand

Brief narration of transaction: advance given to advocate Mr Gopal for field allowance.

Attach documents:

2. Mr Gopal submitted bill for Rs 10,000.

It means, he has expensed equal to advance amount

(expenses = advance viz Rs 10,000 = Rs 10,000)

Journal Vouchers

SN	BH No.	Program	Particulars	LF	Sources				Debit	Credit
		Code No.			Level	Orgⁿ	Type	Payment	Amount	Amount
2	21114		Dr BE Field allowance						10,000
			Cr Advocate Mr Gopal							10,000
			(advance cleared)

Total									10,000	10,000
Amount in words: ten thousand
Brief narration of transaction: advance cleared by Advocate Mr Gopal for field allowance.

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###########

3. Mr Gopal submitted bill for Rs 8,000 and bank voucher Rs 2,000.

It means he has expensed Rs 8,000 and balance Rs 2,000 has deposited into bank.

He has submitted field allowance bill Rs 8,000 and bank voucher Rs 2,000.

(Expenses < advance viz Rs 10,000 < Rs 8,000)

Journal Vouchers

SN	BH No.	Program	Particulars	LF	Sources				Debit	Credit
		Code No.			Level	Orgⁿ	Type	Payment	Amount	Amount
3	21114		Dr BE Field allowance						8,000
			Dr DTCO signal account						2,000
			Cr Advocate Mr Gopal							10,000
			(advance cleared)

Total									10,000	10,000
Amount in words: ten thousand
Brief narration of transaction: advance cleared by Advocate Mr Gopal for field allowance with bank voucher.

4. Mr Gopal submitted bill for Rs 13,000.

It means he has expensed Rs 13,000.

(Expenses > advance, Rs 13,000 > Rs 10,000)

Accountant must issue cheque of Rs 3,000 for excess expenses.

Journal Vouchers

SN	BH No.	Program	Particulars	LF	Sources				Debit	Credit
		Code No.			Level	Orgⁿ	Type	Payment	Amount	Amount
4	21114		Dr BE Field allowance						13,000
			Cr DTCO signal account							3,000
			Cr Advocate Mr Gopal							10,000
			(advance cleared)

Total									13,000	13,000
Amount in words: thirteen thousand
Brief narration of transaction: advance cleared by Advocate Mr Gopal for field allowance and balance paid.

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5. Mr Gopal returned cheque of Rs 10,000 due to tour cancelled.

It means due to some reason, he has cancelled tour.

He will return advance amount to accountant.

Journal Vouchers

SN	BH No.	Program	Particulars	LF	Sources				Debit	Credit
		Code No.			Level	Orgⁿ	Type	Payment	Amount	Amount
5	21114		Dr BE Field allowance						10,000
			Cr Advocate Mr Gopal							10,000
			(advance cleared)

Total									10,000	10,000
Amount in words: ten thousand
Brief narration of transaction: advance cleared by Advocate Mr Gopal for field allowance due to tour cancel.

6. Mr Gopal submitted bill of Rs 5,000 and settled partial clearance.

It means he will clear his advance in partially.

Journal Vouchers

SN	BH No.	Program	Particulars	LF	Sources				Debit	Credit
		Code No.			Level	Orgⁿ	Type	Payment	Amount	Amount
6	21114		Dr BE Field allowance						5,000
			Cr Advocate Mr Gopal							5,000
			(advance cleared partially)

Total									5,000	5,000
Amount in words: ten thousand
Brief narration of transaction: advance cleared by Advocate Mr Gopal for field allowance partially.

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = ₦ = Birr = Currency of your country

PROBLEM: 3B

The following extracted data taken from Kapilvastu Health Office, Kapilvastu, a local level office, for the ending of Ashadh:

a.	Amount given to Ms Manju as advance to purchase office materials of Rs 3,500.
b.	Ms Manju submitted bill of office materials of Rs 3,650 to clear her advance.
c.	Amount given to Accountant Mr Ramesh as advance to purchase of equipment of Rs 150,000 and local allowance Rs 4,000.
d.	On the basis of the bill vouchers submitted by Ms Bandana for office materials purchase of Rs 10,000 and local allowance Rs 2,000 advance cleared.
e.	Mr Mahesh submitted the bills for the purchase of computer Rs 25,000 against the advance of Rs 20,000 for the same.
f.	Accountant Mr Gautam submitted bill for Rs 35,000 against the furniture purchase advance of Rs 30,000 along with bank voucher Rs 5,000.
g.	Local allowance advance of senior assistant Ms Ranjana Rs 10,000 has been cleared against the bill of Rs 8,000 after received bank voucher for the balance amount.
h.	On 30^th Ashadh, house rent paid for the month of Jeshtha, Ashadh and Shrawan @ Rs 18,500 per month.
i.	Machine purchase and local allowance advance of Officer Ms Eshna for Rs 70,000 and Rs 4,000 respectively were cleared against the bill for machine Rs 72,350 and the local allowance bill of Rs 3,800.

Required: Journal Voucher

SOLUTION

AGF No. 203

Central/Province/Local Level

Government of Nepal

Kapilvastu Health Office, Kapilvastu

Date: 2078–03–31

Office Code No. 178

JV No. 1

Journal Voucher

Electronics Transaction No.

Types of Journal Voucher: Payment

Budget Sub-head No.

Code

Activities

Particulars

Sources

Debit

Credit

Sub-head

Program

Level

Bearer

Type

Payment

Amount

No.

Code No.

Orgⁿ

mode

Dr Ms Manju

3,500

(advance for office materials)

Cr DTCO single account

3,500

Total

3,500

Amount in words: three thousand five hundred

Brief narration of transaction: advance given to Ms Manju to purchase office materials.

Attach documents:

Journal Vouchers

Kapilvastu Health Office, Kapilvastu

SN	BH No.	Program	Particulars	LF	Sources				Debit	Credit
		Code No.			Level	Orgⁿ	Type	Payment	Amount	Amount
b	22311		Dr BE Office materials						3,650
			Cr DTCO single account							150
			Cr Ms Manju (advance cleared)							3,500
			(Being- advance cleared by Manju)

c			Dr Accountant Mr Ramesh
			(advance for equipment)						150,000
			(advance for local allowance)						4,000
			Cr DTCO single account							154,000
			(Being- advance given)

d	22311		Dr BE Office materials						10,000
	21112		Dr BE Local allowance						2,000
			Cr Ms Bandana							12,000
			(advance cleared)
			(Being- advance cleared by Ms Bandana)

e	29511		Dr BE Computer						25,000
			Cr DTCO single account (b/f)							5,000
			Cr Mr Mahesh							20,000
			(advance cleared)
			(Being- advance cleared by Mr Mahesh)

f	29311		Dr BE Furniture purchase						35,000
			Dr DTCO single account						5,000
			Cr Accountant Mr Gautam							40,000
			(advance cleared)
			(Being- advance cleared by Mr Gautam)

g	21112		Dr BE Local allowance						8,000
			Dr DTCO single account (b/f)						2,000
			Cr Assistant Ms Ranjana							10,000
			(advance cleared)
			(Being- advance cleared by Ms Ranjana)

h	22121		Dr BE House rent						37,000
			Dr House owners						18,500
			(advance for rent)							55,500
			Cr DTCO signal account
			(Being: rent paid and paid in advance)

i	29511		Dr BE Equipment						72,350
	21114		Dr BE Field allowance						3,800
			Cr DTCO single account (b/f)							2,150
			Cr Officer Ms Eshna							74,000
			(advance cleared)
			(Being- advance cleared by Ms Eshna)

Given and working note:

Advance for equipment	70,000	Bill of equipment	72,350	More than advance
Advance for field allowance	4,000	Bill of field allowance	3,800	Less than advance
	74,000		76,150

Amount paid to Eshna (Cr DTCO signal account) = 76,150 – 74,000 = Rs 2,150

#####

PROBLEMS AND ANSWERS OF JOURNAL OR GOSWARA VOUCHER

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = ₦ = Birr = Currency of your country

PROBLEM: 3A

District Judicial Court, Lalitpur has following information:

Ashwin 10: Advance paid to Advocate Mr Binesh for field allowance Rs 8,000 to go to Janakpur.

Required: Journal Voucher for following conditions:

(a) Advance given

(b) He submitted bill for Rs 8,000.

(d) He submitted bill for Rs 10,000.

Required: Journal Voucher

[Answer: (c) Debited DTCO = Rs 1,000; (d) Credited DTCO = Rs 2,000]

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = ₦ = Birr = Currency of your country

PROBLEM: 3B

Kaski Zonal Hospital, Pokhara has following extracted information for the current year:

1.	Jeshtha 12:	Paid to Mr Gopal as advance to purchase of machinery of Rs 120,000 and local allowance Rs 3,000.
2.	Ashadh 13:	On the basis of the bill vouchers submitted by Ms Geeta for office materials purchase of Rs 8,000 and local allowance Rs 2,000 advance cleared.
3.	Shrawan 15:	Mr Mahesh submitted the bills for the purchase of computer printer Rs 11,000 against the advance of Rs 10,000 for the same.
4.	Bhadra 18:	Accountant Mr Gautam submitted bill for Rs 40,000 against the furniture purchase advance of Rs 50,000 along with bank voucher Rs 10,000.
5.	Ashwin 19:	Local allowance advance of senior assistant Ms Ranjana Rs 10,000 has been cleared against the bill of Rs 8,000 after received bank voucher for the balance amount.

Required: Journal Voucher

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = ₦ = Birr = Currency of your country

PROBLEM: 3C

District Post Office, Rolpa has following extracted data for the current year:

a.	Falgun 2	Office materials advance of Mr Thapa for Rs 17,000 has been cleared against the purchase bill of Rs 19,000. Balance amount paid.
b.	Chaitra 3	Issued a cheque to land-lord for the house rent of Magh, Falgun and Chaitra @ Rs 15,000 per month.
c.	Baishakh 4	Furniture purchase advance of Mr Prem for Rs 20,000 has been cleared against the bill for purchase for Rs 17,000.
d.	Baishakh 28	Paid in favour of the landlord for house rent of Baishakh, Jeshtha and Ashadh @ Rs 15,000 per month after deducting 10% TDS.
e.	Jeshtha 5	Machine purchase and local allowance advance of Mr Ganesh for Rs 70,000 and Rs 4,000 respectively were cleared against the bill for machine Rs 65,000 and the local allowance bill of Rs 6,000.