query about Books of account maintain under cash basis?

This query is : Resolved

Vijay Parmar (Querist)
Follow

07 July 2010 one of the doctor maintain his books of account on cash basis.. generally we record income only when he received cash or chq.

but question is if he purchase medicines on credit on 25th march 2010 and paid on 3rd april 2010.. can we record medicine expenses for the year 2009-10 ???/

should we record expenses on cash basis ??? or mercantile ???/

Aditya Maheshwari

Aditya Maheshwari (Expert)
Follow

07 July 2010 U have to follow the same procedure for booking of income and expenses.

If u book income on receipt basis then expenses will also be booked on payment basis.

In the above case if cheque has been issued on or before 31st March though cleared in next year then the same can be taken in previous year otherwise not.

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
Follow

07 July 2010 agreed Mr. Maheshwari.
Same accounting method will be used for income as well as expenses.

Message likes : 1 times

Akhil Agrawal

Akhil Agrawal (Expert)
Follow

07 July 2010 But There is also an HYBRID SYSTEM of accounting in which the income & exp can be booked on different basis

Aditya Maheshwari

Aditya Maheshwari (Expert)
Follow

07 July 2010 Dear Akhil

Could you please specify the method or how to use the method and whether the same is generally accepted accounting principles in India and also whether they present a true & fair view of the state of affairs of the assessee?

Message likes : 1 times

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