15 July 2017
Turnover is the aggregate amount for which sales are affected or services are rendered by an enterprise.
Not to be deducted:
1. Cash discount otherwise than that allowed in a cash memo/sales invoice is in the nature of a financing charge and is not related to turnover. The same should not be deducted from the figure of turnover.
2. If sales tax and excise duty are included in the sale price while accounting, then Turnover shall include these taxes.
3. Scrap Sales shall form part of Turnover.
To be deducted:
1. Trade discounts (i.e. Discount shown in Sales Invoice) can be deducted from sales but not the commission allowed to third parties
2. Turnover discount is normally allowed to a customer if the sales made to him exceed a particular quantity. This being dependent on the turnover, as per trade practice, it is in the nature of trade discount and should be deducted from the figure of turnover even if the same is allowed at periodical intervals by separate credit notes.
3. If the Excise duty and/or sales tax recovered are credited separately to Excise duty or Sales tax Account (being separate accounts) and payments to the authority are debited in the same account, they would not be included in the turnover.
4. Sales Returns
5. Sale proceeds of any shares, securities, debentures, etc., held as investment
6. Sale proceeds of property held as investment property
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