Items for buying gifts and giving them to customers
Gifts purchased by enterprises for customers can be included in management expenses-business entertainment expenses or sales expenses-business entertainment expenses according to specific departments. If they are gifts with advertising nature, they can also be included in advertising fees and other subjects. The specific accounting entries are:
Borrow: management expenses-business entertainment expenses
Sales expenses-business entertainment expenses
Loans: bank deposits
What are the sales expenses and business entertainment expenses?
Sales expenses refer to various expenses incurred by enterprises in the process of selling materials and providing services, including insurance premium, packaging fee, exhibition fee and advertising fee, commodity maintenance fee, expected loss of product quality assurance, transportation fee, loading and unloading fee, etc. As well as the staff salaries, business expenses, depreciation expenses and other operating expenses of the sales organization specially established for selling the goods of the enterprise.
Business entertainment refers to the entertainment expenses paid by enterprises for the reasonable needs of production and operation. It is a real and necessary expense in the production and operation of enterprises, and it is also a necessary cost for enterprises to carry out normal business activities. However, because it directly affects the national tax revenue, the tax law has restrictions on its pre-tax deduction, which can only be deducted according to certain standards.
Business entertainment expenses related to the production and business activities of the enterprise shall be deducted according to 60% of the amount incurred, but the maximum amount shall not exceed 5‰ of the sales (business) income of the year.