Accounting processing of usage fee income: When confirming usage fee income, the "Bank Deposit" account is debited and the "Other Business Income" account is credited. Prepare the accounting entries as follows:

Debit: bank deposits

Credit: other business income

The above bank deposits are asset accounting items. In order to reflect and supervise the income, expenditure and balance of the enterprise's bank deposits, the enterprise should set up a "bank deposit" account. The debit side registers the increase in the enterprise's bank deposits, and the credit side registers the decrease in bank deposits. The debit balance at the end of the period reflects the bank deposits actually held by the enterprise at the end of the period. The amount of the deposit.

Other business income is a profit and loss account. The credit side of this account registers the income realized by other business activities of the enterprise, and the debit side registers other business income transferred to the "profit for the year" account at the end of the period. There should be no balance in this account after the transfer (credit plus debit minus).

Explanation of Royalty Income

Usage income mainly refers to the use rights formed by the transfer of intangible assets (such as trademark rights, patent rights, franchise rights, software, copyrights) and other assets by enterprises. royalties income.

Determination of usage fee income

Usage fee income shall be calculated and determined in accordance with the charging time and method stipulated in the relevant contract or agreement. Different royalties have different charging times and methods.

If the contract or agreement stipulates a one-time collection of usage fees and no follow-up services are provided, the enterprise shall recognize the revenue in one go when the right to use the asset is transferred; if follow-up services are provided, the revenue shall be recognized during the validity period specified in the contract or agreement. Revenue is recognized in installments.

If the contract or agreement stipulates that the usage fee shall be collected in installments, the enterprise shall recognize the revenue separately according to the amount calculated according to the specified charging time and method.

What does royalty income include?

The main contents of royalty income include: interest income collected from transferring the right to use cash; income received from transferring the right to use intangible assets such as patent rights. Obtain usage fees; receive rents from transferring fixed assets; and receive dividend income from equity investments.