Accounting treatment

This query is : Resolved

Jenny (Querist)
Follow

31 January 2017 what will be the accounting entry for an Event Management Company which has charged its customer for the materials bought for the event+ the services provided by it? What will be taxable value?

Sandeep Dharar

Sandeep Dharar (Expert)
Follow

31 January 2017 It depends whether the company always buys the materials to organize the event, or it provides from its own source.

Jenny

Jenny (Querist)
Follow

31 January 2017 No, generally they don't buy. But for this particular event, they bought refreshments for a crowd of 120. It was a talk event organised on behalf of Career Launcher.

Sandeep Dharar

Sandeep Dharar (Expert)
Follow

31 January 2017 As per ur reply this is a simple reimbursement expenses which u had done on behalf of ur client. So treat it as expense of the client. The entry should be like this.
(At the time of Expense) :-
Client Dr
To Bank
(At the time of receipt from the client) :-
Bank Dr
To Client

And regarding ur service invoice treat it as ur regular service income and charge Service Tax(if applicable). Remember not to charge any kind of tax on the reimbursement bill.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now