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Forums › ACCA Forums › General ACCA Forums › On behalf implications on accounts preparation
Hi All,
Really appreciate you help on this. I’m an ACCA part-student with full time work. I just wish to know how to apply my knowledge into this real life scenario.
(I have included initials as confidentiality)
Scenario:
Haulier Co. ABC is a company that delivers containers to consignees. Their costs are broken down into:-
(1) Cost of sales [Vehicle Repair & Maintenance as it represents a huge bulk in order to perform the sales]
(2) On behalf [They owe on credit (30days) to Customs (Service Tax), Liners (MTT Shipping) & Country ABC’s Port (Port Storage)
ABC then bills their customer XYZ (Invoice:001, payment term 30 days) based on the costs incurred in (2) in the exact same amount (because it is payment on behalf only) + Haulage charges
I realize that Haulier Co. ABC has to bear the costs before it is reimbursed from the payment received from invoice: 001
What are the DR and CR for the on behalf?