Accounting for sale consideration otherwise than in cash
This query is : Resolved
CA Shruti kuchhal
(Querist)
28 January 2015
Dear Experts,
One of my client has got contract for supply of LED lights from one of customers for a real estate project.
The customer will be transferring the said real estate in name of my client as the consideration for supply of lights.
What will be the accounting treatment for the above transaction.
One of my client has got contract for supply of LED lights from one of customers for a real estate project.
The customer will be transferring the said real estate in name of my client as the consideration for supply of lights.
What will be the accounting treatment for the above transaction.
CA R SEETHARAMAN
(Expert)
28 January 2015
Pass journal entry.
Real estate ac dr
To sales ac cr
Pass entries on value adopted for stamp duty payment.
Real estate ac dr
To sales ac cr
Pass entries on value adopted for stamp duty payment.
CA Shruti kuchhal
(Querist)
28 January 2015
Thanx Seetharaman for early reply i was also thinking the same but would it be right treatment as the nature of the transactions is different sale is of revenue nature while real estate is off capital nature
CA R SEETHARAMAN
(Expert)
28 January 2015
Yes it is a right treatment.
CA Shruti kuchhal
(Querist)
28 January 2015
can u explain the logic behind the same
CA R SEETHARAMAN
(Expert)
28 January 2015
Assume you received a cheque for supply of LED lights and Paid cheque for purchase of real estate.
Pass entries for the above. Bank entry will be squared off balance entry is only the journal entry already passed.
Pass entries for the above. Bank entry will be squared off balance entry is only the journal entry already passed.
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