what is accounting entry in book of consinee in consignment account, if del credre commission is1) allowed 2) not allowed
what is accounting entry in book of consinee in consignment account, if del credre commission is1) allowed 2) not allowed
apoorva shinde
(nil)
(46 Points)
Replied 27 April 2012
WHEN ALLOWED:
bad debts a/c dr.
to debtors a/c
commission a/c dr.
to bad debts a/c
profit and loss a/c dr.
to commission a/c
WHEN NOT ALLOWED:
consignor a/c dr.
to debtors a/c
Tejaswi Kasturi
(student-cpt)
(427 Points)
Replied 27 April 2012
If del credre commission is allowed then the consignee has to take the risk of bad debts arising.
thus treatment is
1. bad debts dr
to debtors
2. commision A/c dr
to bad debts
if not allowed then bad debts are treated as normal business expenses and credited to consignor's account
1. bad debts dr
to debtors
2. Consignor A/c dr
to bad debts A/c
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