Notes Payable

[shaikh.wajid20]

Please let me know what are the items that can be included in Notes Payable?
Can a Post Dated Check be posted to the Note Payables Account?

Thanks in Advance!

 

[QBCPA75]

Notes payable would include any obligations to banks or credits based on a formal written agreement such as loans taken out. It would depend on what the postdated check was for as to whether it would be posted to the Notes Payable Account.

 

[shaikh.wajid20]

Please let me know what are the items that can be included in Notes Payable?
Can a Post Dated Check be posted to the Note Payables Account?

Thanks in Advance!

QBCPA75
&
WAEL MOURAD
I really Thank you both for taking out some of your valuable time to reply my question. However, I am still unclear whether a Post Dated Cheque Issued to a Supplier for the Goods or Services received from them will be considered as a Notes Payable?



Consider this example:

ABC & Company Purchased goods from XYZ Company on 1st January 2010

While making payment ABC Company issued Cheques on 1st January 2010 but the Date on the Cheque is mentioned as 25th February 2010.

What should be the Journal Entry for this transaction?

Should the Bank Account Credited immediately when the Cheque delivered to XYZ Company i.e. on 1st January 2010? The Cheque keeps on appearing in the Bank Reconciliation Statement as Cheques issued but not presented for payment!


Or

We can Credit it to Notes Payable Account and upon Presentation of the in Bank,

Debit Notes Payable Account
Credit Bank Account

Hope I was able to explain my thoughts clearly, if you have any question or need any further clarification, please let me know.

Thanks
Wajid