Can someone please advise how to book Sales with inclusive AMC revenue? For example, being a seller cum service provider, if we raise an invoice on a customer for the goods sold + Annual Maintenance Cost (AMC) and book the whole invoice now and pay corresponding sales-tax also, should we also book the whole AMC revenue now or it should be deferred??? (To be recognised over the life of the AMC Contract) Please suggest urgently.
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Bookings for AMC Contracts
Replies (1)
1. As per AS-9 amount that isrecd or has certainty of receipt is to be recognise as revenue. Thus if you have recd the amount or are reasonably certian of its receipt book the entire bill as your income,else book that much amount which you have recd or are reasonably certain.
2. Depending uopn past experiance and depending uopn judgement of management you will have to make provision for amount you will have to incurred towards AMC
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