Compensation from debtor - Sales or Other Income?
This query is : Resolved
11 June 2011
Dear Experts,
We have charged one of our debtor towards compensation for cancellation of purchase order from him.
We have raised normal sales invoice for this.
My query is, whether this will be sales or other income?
Thanks,
Regards
Sushil.
We have charged one of our debtor towards compensation for cancellation of purchase order from him.
We have raised normal sales invoice for this.
My query is, whether this will be sales or other income?
Thanks,
Regards
Sushil.
11 June 2011
The income will be normal business income only...and rasing salesinvoice is wrong....you should have raised debit note for this....
Message likes :
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CA Suresh Jain
(Expert)
12 June 2011
There is no transfer of property in form of goods and therefore, it is not a sale. Mr. Vivek has said rightly that a debit not should have been raised. sureshjain.nj@gmail.com
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