Hi All,
We are retail company,some of our expensive product are sold on EMI basis i.e.customer will give post-dated cheque and take deliver of product.when the sale should be recognised at the time final payment.
Ashwin (Consultant) (142 Points)
25 May 2012Hi All,
We are retail company,some of our expensive product are sold on EMI basis i.e.customer will give post-dated cheque and take deliver of product.when the sale should be recognised at the time final payment.
Giridhar S Karandikar
(Team Lead)
(7543 Points)
Replied 25 May 2012
Delivering the product & raising the Invoice in the name of the customer amounts to actual sale whether payment is being received or not. hence sale shud be recorded at them time of delivery of the product. Because as per AS-9 Revenue Recognition when the property of the goods alongwith the significant risks & rewards is being transferred from the seller to the buyer revenue is to be recognised in the statement of P&L.
However after some time if the seller thinks that the amount recoverable from the buyer wud not be recoverable then necessary provision in the P&L shud be made.
Live class on PF & ESI Enrollment & Returns Filing(with recording)
CAclubindia
