Membership fees of employee

A/c entries 658 views 7 replies

What should be the treatment of membership fees of golf club paid by company on behalf of employee, in cash. Should it be charged to P&L a/c under head "Membership fees" or what??

Replies (7)

If that membership fee is only for one year, then it should be debited to P&L A/c as employee cost.  But if this fee is for a number of years and the employee is under bond to stay with the company for a number of years, then partly it can be booked in this year and balance could be shown in balance sheet as a current asset.

thanks, sir.

 

it is for 6 months. while crediting cash account, which account should be debited?

As mentioned earlier 'employee cost'.

whether it is recoverable from employee?

if it is not recoverable than earlier said by sharma sir's treatment will be done

thanks a lot................no, it is not recoverable.

If the entire membership fees relates to period prior to 31st March, i.e before date of closing of books of accounts, than the same be booked as expense under "Membership Fees" account, else the proportionate exp. up to 31st March to be booked in "Membership Fees" account and the prop amount after 31st March to be booked in "Prepaid expense" account.


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