Commission Expense Journal Entry
Commission expenses are incurred by a company when it pays commissions to sales representatives or agents based on sales made or services provided. Below is an example of a journal entry for recording commission expenses.
Scenario: Commission Payment to Sales Agents
Assume a company pays ₹50,000 as commission to its sales agents for the month.
Journal Entry
| Particulars | Debit (₹) | Credit (₹) |
|---|---|---|
| Commission Expense A/c | 50,000 | |
| To Cash/Bank A/c | 50,000 | |
| (Being commission paid to sales agents for the month) |
Explanation:
- Debit Commission Expense A/c: The commission expense is recognized.
- Credit Cash/Bank A/c: The payment made to sales agents is recorded.
