If we purchase Euro for the foreign tour of Directors then how this transaction should be recorded in the books.
ashish gupta ( student) (1922 Points)
28 November 2011If we purchase Euro for the foreign tour of Directors then how this transaction should be recorded in the books.
Balaji Sarangarajan
(MBA & (CA Final))
(1131 Points)
Replied 28 November 2011
Dear Ashish,
Book the Euro under advances at the rate you purchased the euro. Once the bill is settled close the advance account.
for the remaining balance of Euro's which you will sell it back - if the sale price is more than purchase price the difference has to go to forex gain or loss account and
if the sale price is less than the purchase price the difference has to go to the forex gain or loss account.
you can also adjudt the forex gain or loss in travel expenses itself.
regards
Balaji S.
CAclubindia
