Corporate Gifts Accounting Entry

Customers who fulfill certain terms in an order, are given gold coins of 1 gm, 2 gm, etc.

What is the accounting treatment for it? Is it to be added to indirect expense directly? Is it required to maintain any records of such gifts given?
Replies (2)
Quick Summary
When customers receive gold coins as a reward for meeting order terms, this is generally treated as a sales promotion or marketing expense under indirect costs. It's crucial to maintain detailed records of these gifts, including customer information, order details, and the gift's value, for audit and tax purposes. The typical accounting entry involves debiting a 'Business Promotion Expenses' account and crediting 'Cash/Bank'.

Show as Business pramotion Expenses , under Indirect expenses profit and loss account

Business Pramotion Expenses A/c Dr
To Cash / Bank A/c Cr
( Gold coin given as gift for Business pramotion)

Maintan separate record quantity wise also as Gift given .

When customers receive gold coins (e.g., 1 gm, 2 gm, etc.) as part of fulfilling certain order conditions, the accounting treatment typically falls under indirect expenses—specifically as part of sales promotion or marketing expenses. However, it’s important to classify it correctly based on your company’s chart of accounts and policies.

Yes, records of such gifts must be maintained—including customer details, order fulfillment criteria, value of the gift, and date of issue—for audit, tax, and internal control purposes.

For premium and customizable gifting solutions, including corporate gold coins, buy corporate gifts at Consortium Gifts—trusted for over 25 years in India.

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