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Accounting for optical firm
a customer choose a frame of spectacle of rs 2000 rs and a numbered glass worth 1500 but after complete fitting of glass into frame he refused buy it what are the accounting treatment for it
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| Here is a practical accounting setup for an optical firm: 1. Chart of Accounts (Key Heads): - Sales: Frames, Lenses, Sunglasses, Contact Lenses, Accessories, Spectacle Fitting Charges (service) - Purchases: Frames, Lenses by category, Contact Lenses - Direct Expenses: Lens cutting/grinding charges, fitting material - Indirect Expenses: Rent, staff salary, electricity, advertising 2. Inventory Management: Maintain frame-wise stock (as each frame is unique) and lens stock by power/type. Optical ERP software (like Optik, SpectacleERP, or even Tally with customization) helps track item-wise stock especially for spectacle frames. 3. GST Treatment: - Spectacle frames: 12% GST (HSN 9003) - Lenses (optical): 12% GST (HSN 9001) - Contact lenses: 12% GST (HSN 9001 80) - Fitting/repair service: 18% GST (SAC 9987 or 9988) - Spectacles for corrective vision: Verify if your specific product falls under the concessional rate list. 4. Prescripttion Records: Keep a log of customer prescripttions — useful for warranty claims, repeat purchases, and as business records. 5. Key Accounting Entries: - On sale of spectacles: Dr. Cash/Debtor, Cr. Sales (frames + lens) at selling price + GST - On purchase: Dr. Purchases + GST Input, Cr. Supplier - On fitting charges collected: Dr. Cash, Cr. Service Income + CGST/SGST 6. GST Filing: File GSTR-1 and GSTR-3B monthly/quarterly as applicable. Maintain HSN-wise summary since turnover is likely above Rs. 5 crore threshold for mandatory HSN reporting. |
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