Foreign currency exchange accounting entries
When collecting money (that is, when collecting foreign currency accounts receivable):
Debit: Bank deposit-foreign currency
Credit: accounts receivable
When settling foreign exchange and converting foreign currency into RMB:
Debit: Bank deposit-RMB
Financial expenses-exchange gains and losses
Loans: bank deposits-foreign currency
When purchasing foreign exchange and converting RMB into foreign currency:
Debit: Bank deposit-foreign currency
Financial expenses-exchange gains and losses
Loan: Bank deposit-RMB
Accounting subjects involving foreign currency business
The accounting subjects involved in foreign currency business include bank deposits and accounts receivable, all of which are asset accounting subjects, with debits indicating an increase and lenders indicating a decrease. Among them, bank deposit accounts account for all kinds of funds deposited by enterprises in banks or other financial institutions. Enterprises can account for this subject according to detailed subjects such as banks and other financial institutions and deposit types; Accounts receivable account accounts for the amount that an enterprise should charge due to business activities such as selling goods and providing services. An enterprise may conduct detailed accounting of this account according to the debtor. The ending balance of this course is generally in the debit, reflecting the accounts receivable that have not been recovered by the enterprise; If the ending balance is in the credit, it means that the enterprise has received accounts in advance.
What is the accounting of financial expenses?
The financial expenses account for the financing expenses incurred by enterprises to raise the funds needed for production and operation. Specifically, it includes interest expenses, exchange gains and losses, related fees, corporate cash discounts, etc. Enterprises can carry out detailed accounting according to the corresponding expense items.