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purchased a laptop for Rs.50000 and received one calculator
costing Rs.1000 for free. Both laptop and calculator
(stationery in nature) are meant for office use.What will
be the journal entry in the books of both the parties?
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Answer Posted / h.r. sreepada bhagi
In the books of the purchaser the transaction can be
accounted in different ways as per the policy of the
purchasing company/firm. Various options are:-
1. Treat the Laptop as asset & Calculator as Stationery &
recognise the value of the free item in the books - Debit
Asset (Laptop) with Rs. 50000/-, Stationery A/c with Rs.
1000/-, Credit the supplier with Rs. 50000/- & Discount A/c
with Rs. 1000/-
2. Treat the Laptop as asset & Calculator as Stationery -
Debit Asset (Laptop) with Rs. 49000/-, Stationery A/c with
Rs. 1000/-, Credit the supplier with Rs. 50000/-.
3. Treat the Laptop & Calculator as Assets - Debit Asset
(Laptop) with Rs. 50000/-, Asset (Calculator) with Rs.
1000/-, Credit the supplier with Rs. 50000/- & Discount A/c
with Rs. 1000/-. In this case calculator can be depreciated
100%.
4. Treat the Laptop & Calculator as Assets - Debit Asset
(Laptop) with Rs. 49000/-, Asset (Calculator) with Rs.
1000/-, Credit the supplier with Rs. 50000/-. In this case
calculator can be depreciated 100%.
5. Treat the Laptop as an Asset & ignore calculator in the
books - Debit Asset (Laptop) with Rs. 50000/- & Credit the
supplier with Rs. 50000/-.
6. When payment is made debit the supplier and credit Bank
or Cash A/c as the case may be.
Any of the above accounting treatment can be in line with
the accounting policy of the company and serve only as
guidelines. While accounting this kind of transaction
Accounting Concept of materiality should be kept in mind.
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