Medical equipment is an installment sale with financing.
(1) The sale of equipment is realized
Borrow: long-term receivables
Bank deposits
Loan: Revenue from main business
Taxes payable - VAT payable (output tax)
Unrealized financing gains
Borrow: Cost of main business
Loan: Inventory goods
(2) Annual allocation of financing expenses:
Borrow: Unrealized financing gains
Loan: Finance costs
(3) Sales of consumables:
Borrow: Accounts receivable or bank deposits
Loan: Long-term receivables
Other business income
Taxes payable - VAT payable (output tax)
Borrow: Other operating costs
Loan: Inventories
Expanded Information:
I. This account accounts for unrealized financing gains on leasing revenues or interest income that are phased in by the enterprise.
II. This account can be accounted for in detail by item of unrealized financing gains.
(a) the lessor of finance leases arising from the lease receivable, at the beginning of the lease term, should be based on the lease commencement date of the minimum lease receipts and the sum of the initial direct costs, debited to the "long-term receivables" account, according to the residual value of the unguaranteed, debited to the "unguaranteed residual value "Long-term receivables.
Based on the fair value of the finance lease asset (the sum of the present value of the minimum lease payments and the present value of the unguaranteed residual value), credit the "Finance Lease Assets" account, and based on the difference between the fair value of the finance lease asset and the book value.
Debit "Gain or Loss on Disposal of Assets" or credit "Gain or Loss on Disposal of Assets", credit "Bank Deposits" according to the initial direct costs incurred, and credit "Bank Deposits" according to the difference between the initial direct costs incurred and the initial direct costs incurred. The difference is credited to the account.
Financing income determined on a periodic basis using the effective interest rate method is debited to this account and credited to the "lease income" account.
(2) Long-term receivables arising from operating activities such as the sale of goods or the provision of labor services, which are collected by installments on a deferred basis and are essentially of a financing nature, shall be recorded at the contractual or agreed-upon price receivable if the conditions for revenue recognition are met.
Debit the "long-term receivables" account, according to the fair value of the contract or agreement price receivable, credit the "main business income" and other subjects, according to the difference, credit account. If value-added tax is involved, it should be handled accordingly.
Interest income determined on a periodic basis using the effective interest rate method is debited to this account and credited to the "finance costs" account.
The credit balance at the end of the period reflects the unrealized financing gains that have not yet been transferred to current earnings.
Baidu Encyclopedia - Unrealized Financing Gains