Foreign trade enterprise accounting commission has what payment methods

Export goods VAT rate of zero, itself not taxable, so for the commission, is the FOB price of the amount outside, if the tax is treated as domestic sales tax is based on the FOB price for tax purposes, for the commission is not treated as VAT, the business processing and accounting entries are as follows:

A foreign commission:

The commission is an integral part of the export sales price, and a remuneration to the middleman. A kind of remuneration to the middleman. There are two methods of commission payment: one is the negotiated commission, that is, after the export of the negotiation of letters of credit to the bank, the bank in accordance with the specified commission rate in the settlement remittance after deduction, paid to foreign customers; the other is the exporter in the collection of all the payment, the commission will be remitted separately to foreign countries. Enterprises in the payment of commission, the actual amount paid should be offset against the export sales revenue, paid in foreign currency with the same treatment.

Second, the accounting treatment of commission

Commission is divided into explicit commission, implicit commission, cumulative commission of three kinds, the payment method is different, the accounting treatment is different.

(a) explicit commission. Also known as commission within the invoice, the enterprise according to the net sales of goods after the deduction of commission to collect payment, no longer pay another commission. Accounting entries are:

Borrow: Accounts Receivable - Foreign Exchange Receivables

Credit: Revenue from Main Business - Self-export Sales Revenue

Revenue from Main Business - Self-export Sales Revenue (Commission) Red Letter

(ii) Dark commission. Also known as off-invoice commission. Enterprises according to the total amount of sales of goods collected, and then pay another commission. Accounting entries are:

Borrow: Accounts payable - payable foreign exchange accounts (commission) red letter

Credit: Revenue from main business - export revenue red letter

If the commission is negotiated, in the export of goods when the collection of foreign exchange. The accounting entries are:

Borrow: Bank Deposits

Finance Costs - Exchange Gains and Losses (or Lan or Red)

Accounts Payable - Foreign Exchange Accounts Payable (Commissions)

Credit: Accounts Receivable --Foreign exchange accounts receivable

If remittances are used to pay commissions, the accounting entries at the time of collection of the exported goods are:

Borrow: Accounts payable - foreign exchange accounts payable (commissions)

Credit: Bank deposits

(c) Accumulated commissions. Is signed by the export enterprise foreign underwriting, agent customers, in a certain period of time, according to the cumulative amount of commissions paid. If you can specifically identify a particular export sales revenue, such as the above offsetting entries for offsetting sales revenue processing; such as can not be recognized to a specific export sales, should be included in the "cost of goods sold" account. The entries are as follows:

Borrow: Selling Expenses

Credit: Accounts Payable - Foreign Exchange Accounts Payable (Commission)