Accounting treatement for commission

This query is : Resolved

ramanamma (Querist)
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06 January 2014 Hi friends

For Manufacturing company
how to show in the books of accounts below items .
Discount paid to agents, Distributors, customers etc..
and
Discount received from suppliers of materials .

Thanks

Guest

Guest (Expert)

06 January 2014 Show as a commission for the amounts having commission in nature and even show as a discount involving nature of discount.Dont hesitate its purely a business expenses.Even we are showing the same.

Ganeshbabu K

Ganeshbabu K (Expert)
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06 January 2014 if any paid as commission to any parties make it as expence under selling&marketing expences and pay
.
.
if it is adjusted with sundry debtors adjust in their account debited discount and credit debtor account
.
.
if any discount recd from suppliers take it as indirect income

Dr.CreditorA/c
Cr.Disc received(indirect incmoe)

ramanamma

ramanamma (Querist)
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06 January 2014

sorry friends the above question relating to Discount not for commission title was wrong .

Thanks

ramanamma

ramanamma (Querist)
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06 January 2014 Rachit and Ganesh babu please give me reply to the only for discount
For Manufacturing company
how to show in the books of accounts below items .
Discount paid to agents, Distributors, customers etc..
and
Discount received from suppliers of materials .

Thanks

Guest

Guest (Expert)

06 January 2014 Show it as a discout only....even we are doing the same.

Message likes : 1 times

Ganeshbabu K

Ganeshbabu K (Expert)
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06 January 2014 refer my reply and go ahead
.
.
1)discount recd.
.

Dr.Creditor
Cr.disc. recd(indirect income)
.
.
discount allowed
.
.
Dr.Discount allowed
Cr.debtors

Message likes : 1 times

ramanamma

ramanamma (Querist)
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06 January 2014 is it compulsory required to take gross amount i.e cr- sales & Dr-Disount
or
is it correct in case Net amount considered instead of gross amount

same procedure for purchases also

if we take net amount then the accounting treatment is correct / wrong

is any accounting standard effect by this treatment if we take NET AMOUNT .

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