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Accounting for import purchases

A/c entries 3960 views 1 replies

Murali

CA final cleared and CS final

102 Points Joined September 2007

At what forex rate the import purchase should be recorded:
1.Rate which prevails on the date of invoice.
2.Rate which prevails on the date of Bill of entry.
3.Rate which prevails on the date of receipt of goods.
4.Or any other rate?

Replies (1)

Guest

For Import Purchase

You should consider the rate applied in Bill of Entry. At the time of payment to the supplier please transfer the diference between Bank Rate and Bill of Entry rate in 'Exchange Rate Fluctuation A/c' .

If there is any advance payment made to supplier then you should consider exchange rate on which the Bank debited to your account. in this case no 'Exchange Rate Fluctuation' accounted

Rajesh