Rebate on bill discounted

rebate on bills discounted will be deducted from the interest earned in p/l a/c since it's not this year's income and will be shown in schedule 6 OTHER LIABILITIES in balance sheet

THNX A LOT RAKSHITA.I HAVE ANOTHER DOUBT IN INSURANCE CHAPTER.

I'M CONFUSED THAT IN THE FORMAT OF REVENUE A/C & P & L A/C INTEREST,DIVIDEND & RENT ARE THERE.

I THINK IT SHOULD BE EITHER IN REVENUE OR P & L A/C.

PLEASE EXPLAIN.

U r welcome. See if the question demands only revenue a/c n interest dividend n rent is given thn it will b shown as income and if question asks for both revenue and p/l then if it is clearly mentioned that certain amt of rent dividend is for fire n certain amt for marine insurance thn it will b shown in respective revenue accounts n if no specifications are given regarding the interest dividend as in how much is for fire or marine or misc insurance then such interest dividend shall be shown in p/l

Me too having same doubt in banking chapter, but with slight variance, i.e why we deduct it when we havent even added it in previous year

sorry but I got it..

What is difference between the term rebate and refund ..refer Indiantaxfin.com

For REBATE ON BILL DISCOUNTED THREE entries are there to be made:-

1)OPENING REBATE REVERSE-REBATE ON BILL DISCOUNTED A/C DR

                                                   TO INTEREST & DISCOUNT A/C

2)CLOSING REBATE PROVIDED-INTEREST & DISCOUNT A/C DR

                                                     TO REBATE ON BILL DISCOUNTED

3) TRANSFER BALANCE OF IINTEREST & DISCOUNT TO P/L

                                               -INTEREST & DISCOUNT A/C DR

                                                    TO P/L

 NOTE:-a)discount on bills can be used instead of interest & discount a/c,if questions says specifically interst & discount A/c then used that only otherwise discount on bills a/c

             b)interest & discount a/c balance transfer to P/L a/c is calculated as follows:-

                          opening rebate                                   xxx

                       (+)discount recieved during the year       xxx

                       (-)closing rebate                                  (xxx)

                          = transfer to P/L                                 xxx

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in additional info rebate on bill discounted given is "CLOSING REBATE ON BILL DISCOUNTED" AND IT SHOULD BE DEDUCTED AS PER MY PREVIOUS POST

can anyone give me a logic that why do we add opening rebate on discount on bills