joining bonus

AS 518 views 4 replies
a company paying joining bonus to new employee he has to work minimum 12 months from joining date

accounted like

Joining Bonus( exp) Dr
to bank AC


* is that accounting treatment right?
*whether that joining bonus has differ for 12 or not
Replies (4)
kishor the accounting entry is not correct. since the joining bonus get accrued as and when a new employee joines, but the obligation to pay only arises aftr successful completion of 12 month.

so the entry will be like

Joining bonus a/c Dr
to joining bonus payable
( being joining bonus accounted for)

joining bonus payable a/c Dr
to bank
( being joining bonus payble on successful completion of 12 months)
as per company policy they will initially when employee joins
as per company policy they will pay JB initially when employee joins
so what is the 12 month Claus is for


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