Company's sponsorship

160 views 5 replies

Ks

138 Points Joined February 2022

A company sponsors a trip to their dealer ( who increases company's sales ) total cost to company is Rs 1 lac for flight tickets ,Rs 50,000 for hotel ,15,000 for meals ,Rs 25,000 for sight-seeing and other expenses so the company have to prepare a separate ledger accounts for all hotel exp ,flight, food ??? And then transfer their balance to sponsorship account ??? Or directly debit the sponsorship account

Replies (5)

CA. Abhilash Krishnan P

Chartered Accountant

533 Points Joined June 2008

It is not company's hotel , flight or food expenses, it is actually in the nature of sales promotion expenses so ideally it should be directly debited to sales promotion expenses

sabyasachi mukherjee

28040 Points Joined May 2017

It's a part of marketing and sales promotion.
So expenses paid for the entire promotional expenses must be monitored and incremental revenue generated must be the key driver for growth of the company.

prasad Nilugal

GST Practitioner & Accounts

15029 Points Joined March 2014

You can directly debit to Sponsorship account , however documentary evidence of all expenses are required , It is important for Audit purpose . write in narration reading different experiences .