Bonuses you receive are those suppliers pay to you. They may be calculated on various bases, mostly volume, but also from sales of specific products, with determined prices etc. They also may be paid monthly, quarterly or even annually.\u00a0<\/p>\n
Thing to watch out for with those bonuses is their accounting treatment. Bonuses paid by your suppliers do increase your profit, but not through other income or revenue. What they do in your accounting is decrease the expense for the period they relate to. It’s not just any expense account, but the specific expense account the initial expense was charged to.<\/p>\n
And then there’s the “period” we talk about often. In accrual basis accounting all the income and expense is always accounted for in the period they relate to because the aim of the method is to reach to the results for the period. It’s not about when cash moves.<\/p>\n
So remember to keep the bonuses on appropriate accounts and within the appropriate period, i.e. the one the original expense itself related to. And it\u2019s not only the period, but also the account, which needs to be the same.<\/p>\n","protected":false},"excerpt":{"rendered":"
Bonuses you receive are those suppliers pay to you. They may be calculated on various bases, mostly volume, but also from sales of specific products, with determined prices etc. They also may be paid monthly, quarterly or even annually.\u00a0<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[26,80],"tags":[],"class_list":["post-4562","post","type-post","status-publish","format-standard","hentry","category-2-processes","category-2-10-purchases-and-payables"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\t