Abhay Jain (Internal Auditor) (43 Points)
19 June 2012Advance received by cheque/visa card from debtor in F.Y. 11-12 and sales booked in F.Y. 2012-13. I want to know that ,is swap charges or collection chareges by bank prepaid expenses.?
Giridhar S Karandikar
(Team Lead)
(7548 Points)
Replied 19 June 2012
It shud be debited to P&L & not to prepaid exp.
Prepaid exp is an expense whihc relates to a period going beyond the F.Y. under consideration. So we first debit it to prepaid & then amortise it month/yearwise.
Coll/swap chgs relating to advance recd from debtor does not comes within the ambit of prepaid exp, hence I think it shud be dr to P&L.
CAclubindia
