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Credit period

harsha vardhan (student) (45 Points)

19 October 2020

if company made a purchase of asset for rs. 10000 with a credit period of 2 yrs
then what is the entry as per IND AS

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3 Replies

Devil (Confidential) (177 Points)
Replied 19 October 2020

Asset a/c dr
To creditor
at the time of purchase u should pass above entry

2) intrest a/c dr
To creditor
because u have to pay intrest for 2 months

3) at finally
creditor a/c
To cash/Bank

harsha vardhan (student) (45 Points)
Replied 19 October 2020

How much amount we have to recognise in asset

Devil (Confidential) (177 Points)
Replied 19 October 2020

Asset a/c dr 10000
To creditor 10000

asset a/c dr (intrest)
To creditor (intrest)

creditor a/c dr 10000+int
to bank

intrest should be capitalise on asset cost hence it should not be treaTed as exp