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Transfer l/c sales turnover

Indian Accounting Standards 649 views 1 replies

Dear Sir/Madam,

Thanks in advance to all , i have some question about transferable  letter of  credit transaction. we plan to purchase  goods from China supplier  and sale  goods to Hong Kong buyer under transferable  letter of credit. Hong Kong buyer will open transferable letter of credit in favor of us for $ 100000 and same letter of credit will transfer to China supplier for $ 75000 ( $ 25000 our margin ) and Bill of Lading will be prepared Consignor  would be China Supplier Name and consignee will be To order and notify party will be Hong Kong Buyer ( in Bill of lading it’s not showing our Name any ware ) but we  will raise the invoice for $ 100000 in name of Hong Kong Buyer ( we will receive Invoice for $ 75000 from our Supplier ) Payment also we will receive through our bank for $ for 100000 but our banker will credit to our account  only  $ 25000 ( our margin amount as said above  )   balance amount they will send to Supplier  account ( $ 75000 ) this is our transaction . Now my question is , could we take as a sales turnover of  full invoice value ( here $ 100000 ) or we have to take only  our margin value ( here $ 25000 ).      

Thanks

Anand N M

Replies (1)

You have to take the full value of $1,00,000 as sales and $75,000 as purchase.


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