How to show if material supplied by the service receiver

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This discussion addresses how to record materials provided by a service receiver in lieu of payment. The recommended approach is to debit the material account and credit the service receiver account. While no bill or GST is required, it's advised to record the material at its full value to reflect the contract's total worth, ensuring quantity details are available for auditors.

sowmya

sowmya (Querist)

26 April 2022 Dear Sir,

In work contract they provided material instead of making payment. in such case what will be the entry?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

26 April 2022 Debit material account
Credit service receiver account.

sowmya

sowmya (Querist)

28 April 2022 Material account will shown in purchase a/c without bill can we show like that? we have to give qty details to auditor and the purchase a/c and GST amount wont get match know.

CA Puja Sharma

CA Puja Sharma (Expert)

28 April 2022 Show the purchase of the material at Rs. 1 to record the qty in books.

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CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

28 April 2022 Yes, you can show it record it as service receiver supplied material. No need for bill GST details. Account it on full value so that it can be considered as contract value received.

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