Dear friends My company is paying to his clients (Debtors) like commission from the turnover Ex. My company Sales Billed to Mr.X (Debtor) Rs.300000/- Vat 300000*5%=15000 Then Net Sales is 285000/- From this Mr.x Taking 285000*10%=28500 as commission( paying this amount by Cash/Cheque). actually my sales booked as 285000/- but am receiving only 285000-28500=256500/- from Mr.x
By this effect actual sales are higher than what am receiving from Debtors.
My book profit increases and paying income tax too much.
how can proceed this transaction in books please help me
thank you in advance.
CAclubindia
