Method of accounting to be employed.

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 October 2013 We are into Exports Business. We receive VKUY & FPS licence against our exports as incentive. My query is how these licence to be accounted. On mercantile basis or as an when sold.

aadish

aadish (Expert)
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11 October 2013 Hello Anonymous,

What I am telling you is practically happen in Industry.
I am in Automotive company and have export business as well.

We also getting these License, We are accounting it as and when we sold this license as Bank Dr. To Other Income To sales tax.

But you have an option to account it as intangible asset when you will receive these license and later when you sold it cr, the intangible asset head.

Aadish