What should be the accounting entry

A/c entries 3794 views 11 replies

A LTD COMPANY PURCHASE A CAR FOR THE USE OF ITS OFFICIAL PERPOSE AND IT GET A GOLD COIN FREE.HOW SUCH GOLD COIN WILL BE SHOWN IN THE BOOKS OF ACCOUNT? PLESE ANYONE ANSWER IT.

Replies (11)
That's Good Question by Mr. Barun Nandi, I think, the cost of gold coin will be treated as indirect income as discount from creditors & taken as assets. i.e. Car A/c ............ Dr. Other Assets A/c ............ Dr. To Sundry Creditors A/c To Discount From Creditors A/c. In addition if the cost of that coin will be less than Rs.5,000/- then it should be expense out as Fixed Assets Less than Rs.5,000/-, & taken 100% Depreciation......
Originally posted by : Barun Nandi

A LTD COMPANY PURCHASE A CAR FOR THE USE OF ITS OFFICIAL PERPOSE AND IT GET A GOLD COIN FREE.HOW SUCH GOLD COIN WILL BE SHOWN IN THE BOOKS OF ACCOUNT? PLESE ANYONE ANSWER IT.

Gold Coin .................. Dr

To Misc Income

     OR

To Gifts Received

 

Best regards,

I also agree with the same 

in my opinion, the gold coin should be treated as  current investment as company will be willing to sell it on appreciation.

entry should be -

investments      Dr (with the market value on date of purchase of car)

      Car                    Cr

current investment will be revalued at each balance sheet date with market value.

if company intends to sell it in next three months, it should be added to cash equivelants for cashflow purpose.

 

 

 

I AGREE WITH NEHA.

I am convinced with the Answer given by Neha Ma'am. It should be shown under Investment by passing the following entry:-

Gold Coin (Investment)            Dr.       XXXX

(Grouped under Investments)

     To Car A/c                                                 XXXX

(Grouped under Fixed Assets)

[Being Gold Coin recorded as Investment]

 

Regards,
Devendra K

 

Originally posted by : CA Neha Jain

in my opinion, the gold coin should be treated as  current investment as company will be willing to sell it on appreciation.
entry should be -
investments      Dr (with the market value on date of purchase of car)
      Car                    Cr
current investment will be revalued at each balance sheet date with market value.
if company intends to sell it in next three months, it should be added to cash equivelants for cashflow purpose.
 
 
 

Right answer for this case...

agree with neha mam...........

agree with neha mam..

if it was encashed immediately then

cash a/c dr  xxx

  to car a/c     xxx

one businessman has purchased gold of Rs 217924 in 2011-12 and sold Rs 254450 in 2017-18 so how to calculate capital gain tax on it and what amount of tax was pay to govt.


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