Accounting treatement for commission

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This query is : Resolved

ramanamma (Querist)

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)

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)

06 January 2014

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

Thanks

ramanamma

ramanamma (Querist)

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)

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)

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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