Treatment of discount
This query is : Resolved
30 June 2013
Dear Experts,
A public limited company has come up with a 6 years Discount scheme for selling his product and increasing sales under which:
1. In the first year if a customer buys Rs. 75000 product then he is getting a Discount Coupon of full amount of Rs. 75000 which is redeemable in 6 years.
2. The scheme is - if customer comes after 1 year from the date of purchasing and surrendering the Discount coupon then he is getting product worth 10% of the Purchased amount.
But if he comes in the 2nd year then 20% and so on. In the 6th Year he is getting product worth 100% of the purchased amount.
Customer can surrender only 1 time and it is upon him when he is going to surrender his discount coupon. If the customer is not appearing in the 6th year then his coupon will lapse, so anyhow the customer will have to surrender in 6th year.
Question:
1. When we are going to treat this Discount, at the time of purchase? If the answer is yes then there will be huge loss in the books? If the answer is NO then there will be huge profit at the time of Sale. Please advice?
A public limited company has come up with a 6 years Discount scheme for selling his product and increasing sales under which:
1. In the first year if a customer buys Rs. 75000 product then he is getting a Discount Coupon of full amount of Rs. 75000 which is redeemable in 6 years.
2. The scheme is - if customer comes after 1 year from the date of purchasing and surrendering the Discount coupon then he is getting product worth 10% of the Purchased amount.
But if he comes in the 2nd year then 20% and so on. In the 6th Year he is getting product worth 100% of the purchased amount.
Customer can surrender only 1 time and it is upon him when he is going to surrender his discount coupon. If the customer is not appearing in the 6th year then his coupon will lapse, so anyhow the customer will have to surrender in 6th year.
Question:
1. When we are going to treat this Discount, at the time of purchase? If the answer is yes then there will be huge loss in the books? If the answer is NO then there will be huge profit at the time of Sale. Please advice?
30 June 2013
The scheme is not becoming clear.
.
Please specify the amount of discount in terms of Rs. also so that the terms "Purchase Amount", "Purchased Amount", "Purchasing" etc. could be clearer to the experts. Continue the same example of Rs 75000 in the discount scheme also.
.
Please specify the amount of discount in terms of Rs. also so that the terms "Purchase Amount", "Purchased Amount", "Purchasing" etc. could be clearer to the experts. Continue the same example of Rs 75000 in the discount scheme also.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- ITR -1 Filing
- TWO FIRM NAME IN ONE GST NUMBER
- Section 54 f disallowed will be taxed at what rate
- Transportation of Petrol, Diesel by GTA and Other than GTA
- Transfer of rectification rights to ao
- Which ITR application
- Transfer of Rectification Rights to the Jurisdictional Assessing Officer
- Form 16 Issues
- IGST Refund pending since June 2022.
- Eway issued more than one
- SALES MADE THROUGH E COMMERCE OPERATOR 9(5)
- Igst utilisation query
- Section 12A(1)AC
- Interest will be paid
- CHANGE IN PARTICULARS OF DIRECTOR
- Non- payment of GST on supply of services- reg
- Accumulated surplus exceeding 15%
- Different GST Number MEESHO
- Fees amount transfer procedure for two doctors
- Notice u/s 148 of IT Act
Trending Online Classes
CAclubindia
