How to record export transaction?

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Dear Friends,

I am facing a problem. Please help me to solve it.

Suppose an export of US$ 5000 is made from India and Invoice is made for it at US$5000. Now i want to ask when i want to pass an entry in books in respect of such export sale at what rate of exchange should i convert these US$ 5000 into Rupees for bringing it into books????

How to calculate fluctuation in exchange rate???

Kindly help to solve the above query.

 

Replies (1)

You will record $5000 at the rate which was prevailing on date of invoice say 50/$

Drs would be 5000 X 50

 

when you receive the payment or if you are closing your books then exchange fluctuation should be considered

Suppose the rate is 55 on date of payment

Bank 5000 X 55

TO drs 5000 X 50

To exchange diff(P&L) 5000 X 5

 

if you are closing the books and have not recevied the payment

Drs 5000 X (55-50)

to exchange difference 5000 X 5

 

all the relevant info is in AS-11

https://www.mca.gov.in/Ministry/notification/pdf/AS_11.pdf


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