a purchase goods from b for rs 5000/-
but dont get the bill for the same
at the end of the year b showing debit balance
therefore a raise debit note
and credit b casuse is rate difference
question is here a debit is the rate difference
rate difference link to indirect exp.or purchase
Actually purchase is omitted in the books, but it is treated as rate diff.
As for as ur question is concerned, rate diff can be treated in two ways as u questioned.
adjust in the purchase a/c itself as if it were a purchase return or
treat it as like discount received (indirect expenses).
It depends on the accounting policies followed.
but to adjust in purchase would be the better method
CAclubindia
