RAJ KUMAR (FINANCE MANAGER) (1393 Points)
28 June 2011HELLO FRIENDS, IF A PERSON DOES THE TWO BUSINESS IN PROPRIETORSHIP
ONE IS PROFESSIONAL AND OTHER IS BUSINESS IN ONE BASIS THEY ADOPT CASH BASIS OF ACCOUNTING AND IN ANOTHER THEY ADOPT MERCHANTILE BASIS OF ACCOUNTING.
I PREPARED THE CONSOLIDATED BALANCE SHEET FOR RETURN PURPOSE BUT IN RETURN WHICH METHOD IS TO BE SHOWN.
WHETHER MERCHANTILE BASIS OR CASH BASIS?
@*CS Siddharth Bumb. *
(B.Com, CA Final, CS )
(5270 Points)
Replied 28 June 2011
i think it is not allowed to do business as well as profession business..you can do either one or either of them you can do same other business....but wait for expert's comment...
RAJ KUMAR
(FINANCE MANAGER)
(1393 Points)
Replied 28 June 2011
HELLO FRIENDS, PLS. TELL ME CAN A PERSON RUNS THE COACHING INSTITUTE AND DO THE TRADING BUSINESS BOTH TOGETHER?
Aparna Raja K.C
(Student)
(520 Points)
Replied 28 June 2011
It is always advicible to go for mercantile basis. any way, if the proportion of income from cash basis is more then , give it as cash basis :)
havnt heard of any such rule which restrain a person from running a coaching institute and trading simultaneously :)
kumar
(student)
(138 Points)
Replied 28 June 2011
RAJ KUMAR
(FINANCE MANAGER)
(1393 Points)
Replied 29 June 2011
BUT HOW CAN I FILE TWO RETURNS OF THE PROPRIETOR.
PLS. HELP ME.
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 29 June 2011
you have to follow merchantile basis for both the business.
RAJ KUMAR
(FINANCE MANAGER)
(1393 Points)
Replied 29 June 2011
BUT IN IELTS INSTITUTE HOW CAN I RECOGNIWE THE FEES ON MERCHANTILE BASIS.
Vikas
(CA)
(1135 Points)
Replied 29 June 2011
Dear,
1.You will have to prepare the consolidated Balance Sheet...so you are correct...
2.In the return, mentioning the method of accounting is optional if you don't have the Tax Audit u/s.44AB.
3.Still, Method of accouting for being on a safer shall be mentioned as Mercantile.
Note : Try adopting one method, preferably mercantile to avoid future problems...
RAJ KUMAR
(FINANCE MANAGER)
(1393 Points)
Replied 01 July 2011
PLS. ANY MORE REPLIES THAT IN IELTS INSTITUTE HOW CAN I ADOPT MERCHANTILE METHOD.
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 02 July 2011
gross receipts are your business income, and we presume that there is no due as on end of year as almost every bill is paid, but you might have some advances, for which you would be liable to provide the service at later year, recognize that advance fees and put that in advances.
C.A SHASHANK GOYAL
(Chartered Accountant)
(362 Points)
Replied 02 July 2011
In my opinion , since one return is one which is to filed for both bussiness and profession and also as per the provision of section 145 any method of accounting either cash or mercantile but should be consistenly followed from one year to anotther . so you can chose any of the method but it is advisable to follow mercantile .And also for both bussines as well as profession only one method is to be followed as one return is filed , however if bussiness carried is other person within the section 2(31) then you might be allowed to follow different methods as in that case two different return will be filed .
CAclubindia
