How to account for these transactions?
Posted: 31 May 2022, 21:45
hello,
hope you all doing well
I have a question about the accounting treatment of this case
let's assume that the customer is going to have a contract with us to get an apartment in the future
when the customer signs the contract he gives us a Bank cheques that have a different collection dates but according to the contract he MUST pay all the payment so basically if one cheques was rejected from the bank he should provide us with another way to collect the payment (Cash for example)
so my question is if as he signs the contract
should we make a entry or not ( as i can see no event happened to record it ) and then we record AR when the cheque is due and a contract liability then
is it right accounting procedures ?
hope you all doing well
I have a question about the accounting treatment of this case
let's assume that the customer is going to have a contract with us to get an apartment in the future
when the customer signs the contract he gives us a Bank cheques that have a different collection dates but according to the contract he MUST pay all the payment so basically if one cheques was rejected from the bank he should provide us with another way to collect the payment (Cash for example)
so my question is if as he signs the contract
should we make a entry or not ( as i can see no event happened to record it ) and then we record AR when the cheque is due and a contract liability then
is it right accounting procedures ?