What is Commission Received Account

It is an Indirect Revenue for the agent, broker or for the company (Publishing or Affiliated Company in case of Affiliate Marketing Campaign) which, on the behalf of a company i.e. Advertising company, wants to sell products or provide services as an agent or selling company in order to earn a percentage of sales or for services rendered as a Commission for transactions executed or sales made by it.

It is recorded on Income Statement or Profit And Loss Account as a revenue under operating income.

You Can Also Study, “What is Commission Received In Advance”

Commission Received Journal Entry

When commission received for Cash or Cheque / Check, then following journal entry is recorded as shown below:

                                                    Cash a/c / Bank a/c   XXX

                                                                                Commission Received a/c   XXX

                                    (Commission Received For Cash / Cheque or Check)

Commission Received does not have any balance as it is a Temporary Account which is closed to Income Summary Account which is finally closed to Income Statement or Profit And Loss Account at the end of the accounting period. However, when it is earned, we credit it and when it is closed to Income Summary Account, we debit it.