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Sales Promotion Expense of Samples.
If goods are converted into samples and given as free to doctors should the expense be shown as sales promotion expense in profit and loss account ?
Replies (7)
YES YOU CAN AS ITS PROMOTIONAL ACTIVITY OR YOU CAN SHOW THAT IN UNDER HEAD PROMOTIONAL SCHEME (IND EXP)
also ITC proportionate to sample have to be reversed
Yes , ITC attributes to goods given free on promotion has to be reverse as per section 17(5)
Agree with Nikhil and Pankaj ji views.
Itc Has been reversed but do I also show the amount of goods converted into samples as expense which were initially part of purchase amount and the quantity was reduced from closing stock valuation.
u must do the entry only as follows-
Advertisement A/c Dr. with the amount of sample given
To purchases A/c
Advertisement A/c Dr. with the amount of sample given
To purchases A/c
I Agree with Mr Nikhil. this is the right entry.
R.K.GUPTA
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