As per the Murabaha contract, the selling price of USD 1,500 is due from the client in

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As per the Murabaha contract, the selling price of USD 1,500 is due from the client in five equal instalments of USD 300 at the end of each year. What entry should be passed by the bank at the time of the sale in respect of the profit element of the transaction:

a. Dr. Receivables (Asset) 500; Cr. Profit (IS) 500

b. Dr. Receivables (Asset) 100; Cr. Profit (IS) 100

c. Dr. Profit (IS) 500; Cr. Deferred Profit (Contra-Asset) 500

d. Dr. Deferred Profit (Contra-Asset) 500; Cr. Profit (IS) 500

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Related Book For  book-img-for-question

Financial Reporting For Islamic Financial Institutions Accounting Standards Interpretation And Application

ISBN: 9781032464022

1st Edition

Authors: Abdul Rauf Mahar, Ayesha Bhatti, Muhammad Junaid Ashraf, Asfand Zubair Malik

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