Advertisement Expenses are the expenses of a business organization which helps in reaching a product or service to the right user of that product or service.
Aim of Advertisement expenses :
To attract new as well as existing customers for using a product or service.
Some modes of Advertisement Expenses are listed below.
Advertisement through Marketing personnel
Advertisement through Wall Posters/Leaflets
Display through TV Channels
Use of different Online Advertising Networks etc.
When Advertisement Expenses incurred but not yet paid, the affected Ledger Accounts are :
Advertisement Expenses Account - Debit
Advertisement Expenses Payable Account - Credit
Journal Entry
Ledger Posting
In Advertisement Expenses Account
In Advertisement Expenses Payable Account.
Example
In the Books of M/s.Trimurthy Traders, amount of expenses incurred for ₹19250/- on dt.31/08/2021 towards Advertisement as per Invoice No-710 received from Kumkum Advertisement.
Pass necessary Journal Entry and Post them into their respective Ledger Accounts for the above transaction.
In the above example
Debit Ledger is :
- Advertisement Expenses Account
Credit Ledger is :
- Advertisement Expenses Payable Account
Journal Entry
Ledger Posting
In Advertisement Expenses Account
In Advertisement Expenses Payable Account.
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