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Water expenses- how to pass entry?

Accounting Entries 45714 views 16 replies

Dear friends

I need one clarification. How to do entry for water exp.,(purchase of water can for drinking purpose) whether it comes under utility bill>>indirect exp., (or)

Staff welfare exp>>indirect exp.,

Please guide me...

 

Thkx in advance

malarvannan.

Replies (16)
Quick Summary
Drinking water purchases like cans are treated as staff welfare expenses under indirect expenses. Municipal water bills are recorded as utility expenses. Classification depends on usage, staff welfare, or general operations.

water bill paid to muncipal council will be under the head muncipal expenses- indirect expenses

As you purchase the water cans it comes under staffwelfare exp>>indirect expenses,

if you pay watertax to the municipality it comes under utility bills>> indirect expenses

generally considered as staffwelfare...

as mentioned if bill is being paid to municipality,, then under utility bills:)
 

Dear Friend,

Please Note,

Drinking Water Expenses should be Debited in Staff Welfare Expenses. and should be under INDIRECT Expenses

Why will water expenses come under indirect expenses?

It will be considered as day to day expenses. It will be indirect in nature. Group it under other general expenses. 

Could you please suggest on how the entry will be done for unexpected costs relating to Covid-19?

We have purchased 5000 ltr water (from water Tanker supplier) for general use (Like Use bathroom etc) not for drinking purpose. then i can book it in staff welfare exp. Please guide me.

Factories act 1948

18. Drinking water.—(1) In every factory effective arrangements shall be made to provide and maintain at suitable points conveniently situated for all workers employed therein a sufficient supply of wholesome drinking water.
 

It is a direct expense because it is mandatory for production workers. 

without prejudice to the provisions of clauses (d) and (e) of sub-section (1), the floors, portions of the walls and blocks so laid or finished and the sanitary pans of latrines and urinals shall be thoroughly washed and cleaned at least once in every seven days with suitable detergents or disinfectants or with both.

all such accommodation shall be maintained in a clean and sanitary condition at all times;
(e) sweepers shall be employed whose primary duty it would be to keep clean latrines, urinals and
washing places.

It is an indirect to expense here because it’s for maintenance.

Any water used by staff are admin expenses. 

This must be like that as the cost behaviour changes as per the act, or else you can just claim it is utilities anytime as per my opinion. 

 

But day to day costs are expensed.

What is cost behavior change?

Indirect to direct and direct to indirect

Originally posted by : yasaswi gomes
Indirect to direct and direct to indirect

 

Got it! Thanks for the info

 

If any aqua guard water purifier is purchased... how the entries r treated and under what group does it comes


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