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Are the following transactions enteredon the credit side or debit side of BOP account ? (i) Exports (ii) Imports (iii) Borrwings from rest of the world (iv) Gifts from abroad (v) Lending to abroad. |
Answer» SOLUTION :TRANSACTIONS which invole inflow of foreign exchange are RECORDED on credit SIDE and outflow of foreign exchange on DEBIT side. Accordingly items (i), (iii), (iv) are credit items because these bring in foreign exchange. Items (ii) and (v) are debit items as these cause outflow of foregin exchange. |
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