Chinmay M. Mulay (Article) (28 Points)
01 December 2012Can somebody please tell that what will be the accounting entry from auditor's point of view.
If a company receive a bill of Rs.12000 say for AMC what will be the accounting entry for year ending March? No payment has been made...
& in same case what will be the entry if the full payment is made in March itself??
CA jatin k Gohil
(CA Practice)
(95 Points)
Replied 01 December 2012
According to me as in 1st case
if payment has not been made till the end of the march that time just pass the exp. booking entry
AMC - Accounting charges ..........Dr. ### (show in exp.)
to Party A/C (Show in Balance sheet at Current Liabilities)
And in 2nd case
if payment has been made till the end of the march (We need to pass 2 entries)
1st entry will be same as above
2nd Entry will be
Party A/c .......Dr ( ## )
To Bank A/c ..... ( ## )
Assumption (AMC charges realted to period April to Marchf for the same year)
CA Pintu Mishra
(Chartered Accountant- Industry)
(514 Points)
Replied 01 December 2012
AMC- Annual Maintenance Charges
We should know the period covered under the AMC service if it is for a period starting in the current year and ends in next year then we should divide it on time ratio and dr expenses this year for the amount apportioned for this year and expenses related to next year will go to prepaid expenses and same shall be transferred to expenses in the next year.
for ex- AMC-12000/- (MAr-12 to Feb-13)
entry
AMC Charges--DR 1000
Prepaid Exps- Dr 11000
to Party 12000
next year
AMC Charges Dr-11000
to prepaid Exps 11000
Date of payment nothing to do with that.
Nithin Chettoor
(Assistant Manager)
(388 Points)
Replied 01 December 2012
AMC expenses has to be apportioned across the period under cover and if the period spreads over more than 1 Financial years, then it has to be apportioned between those years. Payment for the same is not a relevant fact for the accounting of the expenses incurred.
Regarding the entry, i agree with Pintu Mishra.
Sameena
(B.Com)
(22 Points)
Replied 03 December 2012
Sir,
I want know if we added courier charge in sales bill to party. it is direct expenses or Indirect exp.
& which accounting legder mention courier or transportation charges.
Plz reply me.
CA Pintu Mishra
(Chartered Accountant- Industry)
(514 Points)
Replied 03 December 2012
@ sameena if we add courier charges to the sales would form part of income...if it is one time affair has to be indirect income. And if it added everytime you should take it in costing and the sales shall include courier charges and shall not be shown seperately.
Nithin Chettoor
(Assistant Manager)
(388 Points)
Replied 03 December 2012
What is the nature of courier charges??? Is the product delivered via a courier??? then it is delivery charges related to despatch of goods and it can be a direct expense. Or is the invoice or documents sent to the customer via courier?? If it is not part of the contract or agreement agreed, then it can be classified as Selling & Distribution Expenses. And in this case, if the expenses are reimbursed by the buyer, then where is question of accounting for expenses coming?? And if its part reimbursement, then the balance which is not reimbursed can be classified under the head Selling & Distribution Expenses.
CAclubindia
