Dear Experts , Need opinion on below.
We are into Healthcare industry. Business model is to digitise the doctors prescripttion. For which we provide them a specially designed digital pen and ncoded prescripttion papers. We change to client for pen provided on annual subscripttion basis. However pen remain our property throuhout the life time and we collect back the pen at the end of subscriptttion period if subscripttion does not gets renewed. And for pre printed priscripttion papers we charge them nominal amount on per paper basis.
Question is - One of our doctor client to whom we had charged for Annual subscripttion (for pen) have lost the pen in lieu of which we have issued another pen under same model. Now how to account subscriptttion amount for the lost pen ? Whether it will remain as Annual Subscripttion Amount or will it be called as Sale of pen and what could be impact of GST on this. Since the quantity of pen is to be reduced from Stock by its purchase value , stock effect is clear but while accouting revenue please advice on Accounting head and Entry and also the rate of GST.
Jayesh
CAclubindia
