19 August 2013
I have a Query about recording of Purchase Bills in below mentioned situation.
X and Y are two sister concerns and has trading business. Y has purchased some of the goods in behalf of X for which X has passed journal entries in its books of accounts as purchase and has paid the amount by cheque. However the purchase bills are in the name of Y.
So how to treat these transactions in the books of both the firms?
22 June 2015
Since Purchase bills are in the name of Y, purchase has to be booked first in the books of Y. Then they should be sold to X. THen X can make payment for Purchase to Y and Y should pay to original seller.
CAclubindia
