Exchange Rate Difference

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Ravi (Querist)
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13 February 2009 I am working in Export house. I want to know that if we books export bill in April 2008 and payment received in May 2009 then where the applicable Exchange rate difference in F.Y. 2008-09 or 2009-10. also
Which rate on 31 March enter and then what is the rate on payment received we calculate, please help me also give the example of entry.

satish kelkar

satish kelkar (Expert)
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13 February 2009 Book the amount at the rate prevailing as on 31st March for FY08-09.
When amnt is receoved in MAy 09, book the receipts at the actual rate as per bank advice. Ascertain the diffrenec between the rate at the time of actual receipt and the rate as on 31-08-09 and account for the exchange profit/loss in MAy 2009

Ravi

Ravi (Querist)
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13 February 2009 Thanks,

Please, give the example to pass this entry in books.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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29 March 2012 Let us take the following example:

Rate on date of purchase - 48
Rate on 31.3.2009 - 50
Rate on date of payment - 52

Entries:

1. Purchase
Purchase A/c Dr 48
To Creditots 48

2. Entry on 31.3.2009
Exchange Loss A/c Dr 2
To Creditors 2

P&L A/c Dr
To Exchange Loss

2. Payment
Creditors A/c Dr 50
Exchange Loss A/c Dr. 2
To Bank A/c 52

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