debited account in FOC

[Former Member]

Dear Gurus,

In case free of charge delivery (customer account receiveable not debited) in which we have only excise, how do we determine/assign the debit account?

regards

PUB

[Former Member]

It will be same like normal sales, here the entries will be

Customer a/c debit ( Only Taxes)

Sales revenue credit

Discount a/c debit

TAX a/c credit

Thanks,

Raja

[Former Member]

Dear all,

But in FOC we don't debit customer account.

Then where we need to maintain that debit account.

regards

[Former Member]

So from where taxes are coming?

Thanks,

Raja

[Former Member]

Hi,

FOC means that customer will not be charged for the material basic price i.e customer a/c will not be debited.

In our case, in free of charge delivery with excise,

the material basic price does not hit any account

the normal excise a/c are credited

an after sales a/c 9999999 is debited

i want to know where is 9999999 is maintained/assigned

thanks

[Former Member]

Dear all,

What I want to say is,

During release to accounting of sales invoice,

When we debit to a G/L a/c, a/c are maintained in VKOA.

When we credit to a G/L a/c, where are the a/c maintained?

regards

[Former Member]

Hi

Debit and credit entry of G/L accounts depends upon posting key .and VKOA does not determine the debit or credit entry it is

only specifying which G/L is to be posted. Please discuss with your FI colleague to know more on FI document types and posting keys.

ON FOC part ,if u r collecting excise /Taxes from customers then obviously u have to debit that to customer.

While sales price or basic price which u wont collect from customer should go to sales promotion expenses G/L account.

This u achieve either by maintaining separate Pricing procedure or separate accseq as per order reason in VKOA and maintaining relevant account determiantion for them.

Regards

Mandar

[Former Member]

Hi Mandar,

Taking this question ahead, I have a unique requirement from my cleint.

He wants to create a order type for FOC Sales (ZFOC) and put the normal price of the product in SO (Say Rs. 5000.00 + VAT + Excise conditions).

During billing, the customer wants:

1. The entire receivable amount for the customer to be zero, (Inclusive of base price, Taxes and Excise)

2. The entire pricise + Tax + Excise Condition total to be booked under a G/L for Warrenty Expense.

3. The VAT charged on this transaction needs to be seperately posted into VAT PAyable G/L Account, since in FOC sales the client is paying Taxes to the government, although not charging the same to the customer.

For point 2, the system has been configured correctly.

However, for pt 1, when we try to give 100% discount on Basic + Tax + Excise, the customer account is showing negative posting by the VAT/CST amount as appearing in the SO.

For point 3, we are unable to post the VAT in a new G/L for Tax Payable seperately.

Please suggest if any think can be done to configure the solution as asked by the client.

Thanks,

Sameer Vij

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