Invoice received in advance for future services

Save Share

This query is : Resolved

pravin (Querist)

31 January 2018 Hi,
If an invoice was received in current March 2018 and its services are to be rendered in June 2018 and payment is followed by services, how this can be accounted? what would be the Journal entries for this. Further if TDS is also involved for such services, what would be treatment for the both financial years?

Thanks in advance.

CA Amrita Chattopadhyay

CA Amrita Chattopadhyay (Expert)

03 February 2018 In the current year ending March 2018, the advance amount will be shown under advance paid to parties after deduction of TDS. The expense can be shown after the completion of work and receiving the final bill.

pravin

pravin (Querist)

03 February 2018 Thanks for the reply.
Actually we only received the invoice. The services and payment will be made in next year. So still it will be shown as advance paid(as the payment not made before April 1st 2018) in balance sheet?

CA Amrita Chattopadhyay

CA Amrita Chattopadhyay (Expert)

03 February 2018 You cannot receive invoice if the work is not executed. However, performa invoice can be obtained based on which advance payment can be made.

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