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Hi,
Please tell me what are accounting effects will take place
after the rebates are processed?
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Answer Posted / syed rafi,version it technolog
Actually Rebate is a agreement discount between customer &
company.
At the end of the agreement company has to pay the rebate
amount,only if customer fullfill the agreement.
after updated the rebate value in VBo2.
Generally accepted accounting principles state that rebates
are a reduction in sales, not a selling expense. Therefore,
companies must account rebates when selling goods. For
example, a company sells widgets for $5 each. A planned 20
percent rebate is coming to induce higher sales. The
company sells $100,000 in widgets after the rebate takes
effect. The company must record $80,000 in sales and
$20,000 in liability for rebate claims in the general
ledger.
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