Accounting Principles Followed In Tyre Industry

Accounting Principles followed in Tyre Industry (Roll no. 6 - 10) 1. revenue enhancement credit MRF Tyres Sale of goods and go be accepted when risks and rewards of willpower ar passed on to the customers which generally coincides with delivery and when the services are rendered. sales include Excise certificate of indebtedness but chuck out value-added tax and warranty claims. Apollo Tyres tax income is recognized when the momentous risks and rewards of self-control of goods have been passed to the buyer. Gross sales are inclusive of attain duty and are crystallise of trade discounts/sales returns/VAT. Dividend income on investments is accounted for when the justifiedly to receive the stipend is established. entertain Income is recognized on time proportion basis. JK Tyres Revenue knowledge is done when the significant risks and rewards of possession of goods have been passed to the buyer. Sales include Excise Duty and are net of VAT/di scounts/sales return. Revenue Recognition Comparison & outline It can be seen that tax income recognition is exactly the corresponding across the three tire companies. The revenue is recognised when the risks and the benefits associated with the ownership are passed on to the buyer. In tyre industry it unremarkably happens with delivery and when the services are rendered to the buyer.

Interest income is recognised on time proportion basis and dividend income is recognised only when the right to receive the payment is established. Thus, the companies use blameless service sign on method of revenue reco gnition. 2. Inventories MRF Tyres! Inventories consisting of stores & spares, au naturel(p) materials, work-in-progress and correct goods are valued at lower of hail and net realisable value. toll of Goods Sold: The cost for raw materials, work-in-progress and finished goods is calculated on FIFO basis. WIP and finished goods inventories include work cost and other related overheads. The cost of stores and spares is computed on heavy Average personify basis....If you want to get a safe essay, order it on our website: OrderCustomPaper.com

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