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Upfront / prepayment received from a customer

Accounting Entries 257 views 2 replies

Hi,

I have a customer, wherein i have requested for upfront payment of Customs duty for his goods to be cleared from customs. 

After receiving the advance where should i account the upfront payment received from the customer.  Please provide journal entries.

Also can i deduct this advance received once all services provided, in the Final invoice provided to the customer.

Also please advise, whether i should be providing Customer with an invoice of the gross value without deduction of the advance received or the net value with deduction of advance received.

Appreciate your guidance as per IFRS.

Thanking you,

 

Replies (2)
Dr Bank Cr Advance from customer ; Dr Customer Cr Sales ; Dr advance from customer Cr Customer ; Dr Bank Cr Customer ( final settlement ). Make gross bill only. Even if you make a net bill showing deduction of advance , there is no problem.

Showing advance on bill is your choice. If you want to show it then show it below gross amount of Bill.


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