ENTRIES OF GOODS IN TRANSIT

J.SINGH (ACCOUNTANT) (61 Points)

05 November 2022  

Sir,

Mr X Sold the goods worth Rs 100000/- to Mr B on dt 29.03.2022 but Mr B did not received the goods till 10th Apr il-2022.

Now we have passed the Journal entries in Books as  on 31.03.2022 per detail given below

Goods in Transit Dr  - 100000/-

   To Mr X                                                100000/-

Now the question is this Our C  A  says this entry is wrong, but if we dont book the goods in transit how the balance will tallies as on 31.03.2022 if we get the notice from Income tax Depptt. and the balance does not tallies will deptt add the Rs,100000/- in profit.

My question is this if our case is choosen for scrutiny and balance does not tallies than can deptt make addition