Book keeping for accounts in different currency

Divya Garg (Director) (178 Points)

27 December 2013  

Hi All experts, 

 

I have a quick question regarding some accounts entries for transactions involved in 2 different currencies (INR and US$). Please analyse the following case and let us know your comments :

 

A pvt ltd company has an account with say an Indian bank with currency INR and a US bank (or Paypal) with currency US$.

 

company raised an Invoice of 540$ on say 1st Nov,2013 for a client based in US. client pays the invoice completely in US$ on 15th Nov to our US-BANK account.  On same day i.e. 15th Nov, our US bank deduct 40$ as fees for that transaction. 

 

On 20th Nov, US bank converts the remaning 500$ to INR and transfer the same to our Indian bank account on same day.

 

Accounting experts, please help us in recordin these transactions along with foreign exchange gain/loss in our account books. 

 

Thanks,
Divya