B ltd (aluminium manufacturer) is going to erect a plant. It is planning to outsource entire erection and commissioning work to ABC pvt ltd with following terms & conditions
1. entire expenses of erection and commissioning to be borne by ABC pvt ltd
2. B ltd will not pay any amount untill plant is ready for operation
3. After plant is ready for operation B ltd will pay ABC Pvt ltd 20 lacs every month for 12 month
4. After 12 months entire rights pertaining to assets to be transferred to B Ltd
My Query ?
1. what will be the accounting treatment of erection and commissioning expenses in the books of ABC pvt ltd - i.e Fixed assets or stock ?
2. How revenue 20 lacs every month will be booked after plant is ready for operation ?
3. when and how assets should be transferred by ABC pvt ltd to B ltd.
4. At what price asset will be recorded in the books and From which date B ltd will be able to claim depreciation ?
One developer company pays staff salaries without deducting the EPF contribution from employees. The company pays both employer & employee contributions from their bank account & shows employees' contributions which are actually paid by the employer as staff welfare in books of accounts. If this method is correct? please clarify urgently.
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Dear Team,
Good day to All,
Could anyone please advise how to account freight charges shown in the Sales Invoice generated by my firm.
Example: Sale of FG 100
freight 05
Total 105
Can I consider Total sales value as 105 or should I take 5 (freight charges) into COGS.
Please advise and do the needful.
Thanks and regards,
V B Vijay Kumar
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can I make GST Input register monthly in this way
Sales 1000
Add Debit Note 100
Add GST Payable RCM 200
Sub Total 1300
Less Credit Note 50
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Less GST Input 500
GST Input RCM 200 700
Net payable by Cash 700
Is correct process
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Landmark Judgments: Important Provisions of the EPF & ESI Act interpreted by the Honorable Supreme Court of India
Accounting treatment for erection and commissioning project ?