30 August 2022
A tech logistic Advisory does following financial transactions 1. Gets prepaid money from its customers(B2B & B2C), a part of that money will be sales and other part will be passed on to Delivery Service Company because they actually get to that customer place and get goods and then go to destination to deliver goods Journal Entry will be 1.1 Bank A/c Dr. 1,000 To Adv. From Customers. 1,000 (Being Prepaid money received) 1.2. Adv. From Customers. Dr. 100 To Sales. 100 (Being Sales for Delivery Advisory Service) 1.3. Adv. From Customers. Dr. 900 To Vendor Delivery Co. 900 (Being Delivery Charges Payable to Vendor Delivery Co.) 1.4. Vendor Delivery Co. Dr. 900 To Bank. 900 (Being Delivery Charges Paid)
The above entries are fine and easy.
But I want to know how to account for Cash on Delivery transactions. Sometimes, customers will have C.O.D. so I am liable to pay him the COD amount which I get from the Vendor Deliver Co.