Accounting for Letter of credit

[Naresh Kumar Yadav]

Please help me how to make journal entry for purchasing goods against LC and making their payment.

 

[Fidget]

Assuming letter of credit means the supplier is letting you pay later for purchases, just cr the supplier account and dr whatever account the purchase is for.

When you pay the bill, then it will be a cr to the bank account and a dr to the supplier account.