the party has supplied the materials on 30th march u have received the materials on 3rd april in what way party and material will be reflected in the accounts as on 31st march...?
6 Replies
Krishna Upadhya
(Consultant-Tax Advisory Services)
(53 Points)
Replied 16 July 2011
If you have paid any advance to supplier, show it as Advance to supplier under Loans and Advances. In case no advance is paid entry for receipt of goods and creation of creditor only to be done once goods are received, i.e: 3rd April. No entry at the end of the year.
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 16 July 2011
| Originally posted by : Krishna Upadhya | ||
 |
If you have paid any advance to supplier, show it as Advance to supplier under Loans and Advances. In case no advance is paid entry for receipt of goods and creation of creditor only to be done once goods are received, i.e: 3rd April. No entry at the end of the year. |
 |
CA Hardik
(Profession)
(92 Points)
Replied 19 July 2011
Sir
The entry shall be following(31.03)(on the basis of Invoice received)
Purchase A/c dr XXX
To Creditor XXX
While material shall be reflected as Stock in Transit in Balance Sheet instead of St inTrade.
surender
(Manager Accounts)
(149 Points)
Replied 28 July 2011
If you have paid any advance to supplier, show it as Advance to supplier under Loans and Advances.
If you have received goods before 31st then show in sundry creditor.
Exceptions:
Technically, goods in transit belong to the party holding legal ownership. Ownership depends on the F.O.B. terms. Goods sold F.O.B. destination do not belong to the purchaser until they arrive at their final destination. Goods sold F.O.B. shipping point become property of the purchaser once shipped by the seller. Therefore, when determining the amount of inventory owned at year end goods, must be considered in light of the F.O.B. terms. In the case of F.O.B. shipping point, for instance, a buyer would need to include as inventory the goods that are being transported but not yet received. The diagram at right is meant to show who includes goods in transit, with ownership shifting at the F.O.B. point noted with a "flag."
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