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Sales

Sakshi (article) (34 Points)

10 June 2016

why sales rocorded at gross basis?? Can all plz explain the concept of main business model ...

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CA Saurabh Singh (Practising Chartered ) (974 Points)
Replied 10 June 2016

Hi Sakshi,

Sales is the total inclusion of profit,cost,taxes which a seller charges in the bills.However any sales return is directly offset by the sales.

Now accordingly in the inclusions in sales we bifurcate the Gross profit in trading concerns and the net profit.

If you go through cost sheet sales is the begginning of all direct cost, indirect cost adjustment of stocks and finally profit, which a seller tries to recover from his customer and the same in shown in the credit of P/L and whic is considerd his annual turnover.

Hence to get a clear picture of recovery of cost and profit sales is always shown gross.