share transaction

This query is : Resolved

rajender singh (Querist)
Follow

29 March 2010 pls clearify the entry of sale and purch. of share in a day book in lac

example

100 share purchase @ 100/-

100 share sale @ 105/-

can i book as sale and purchase

purchase dr. 10000

sale Cr 10500

or

can i book as net profit

this type of transaction in a day and lacs

cash/bank dr. 500

net profit cr 500

Rahul Gupta

Rahul Gupta (Expert)
Follow

29 March 2010 In Case, it is a regular business then the first entry of recording sale purchase is to be recorded.

However,if it is done as a speculatiion then the net profit or loss will be recorded..

Experts views solicited.......

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
Follow

29 March 2010 when purchased---

investment in shares Dr
To Bank

When Sold----

Bank A/c Dr
To Investment in share
To LTCG or STCG or Share profit

But i agree with Rahul. in case it is regular business you can show as purchase and sell and Shares tto be shown as stock in trade. otherwise above entries are suggested.

Upgrade to CAclubindia Pro. Subscribe Now!