Foreign Exchange Rate Difference -Accounting

Final 3913 views 5 replies

 

one of our freind asked me regarding the accounting procedure of difference

in rate in foreign exchange payments.

 

Example:

 

June 16,09 Purchase from Korea 11525USD @ 47.90/USD

But payment made on 23.08.09 @ 46.87/USD

 

Kindly advice the accounting procedure for the difference.

 

Replies (5)

Foreign Exchange Diff. will be credited to P&L A/c

hi...

for details ... pl. ref. Accounting Standard -11. it ll help u..Files attached

Foreign Exchange Fluctuation is covered under AS 11 and willbe accounted in P & L A/c.

Foreign exchange difference Rs. 11870.75 shall be credited to P&L A/c

 

suppose i have purchased goods worth 50000 US $ @ 44.25 INRon 22/02/2011 but payment made in different financial year say 22/05/2011 so what will be the tratment in year 2010-11. should i make any provision and if yes what will be the base for it.........please explain me with example?


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