M/S Arora Bros , a dealer in Electric Appliances, has received an order for five LCDs along with an advice of Rs. 1,00,000. The firm maintains its accounts on accrual basis of Accounting. Should the amount received i.e. Rs 1,00,000 be credited to the sales account or the advance received account. Give reasons for your answer
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It is advance received because the order of LCD is yet not done from our side and is credited as it would increase our liability
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