What is the Journal entry for goods sold as samples
15 Replies
ashish gupta
( student)
(1922 Points)
Replied 07 November 2009
1For raw material or in trading concern
Free Samples A/c Dr.
To purchase A/c
2 For finished Goods
Free Samples A/c Dr.
To Sales A/c
shalu
(student)
(43 Points)
Replied 07 November 2009
ashish , could u explain d journal entry no. 2 plzz
Ashish Ojha
(Chartered Accountant)
(469 Points)
Replied 07 November 2009
I think entry should be..
1. Free Sample A/c Dr....
To Stock/ Purchase A/c
. P & L A/c Dr....
To Free Sample A/c
If any Sample is "free" then How can we credit sales & with what amt???
We can only charge the cost of samples to Profit & Loss A/c, just like any other Expenditure for Advertisement...
triumph-CMA
(Chartered Accountant)
(503 Points)
Replied 07 November 2009
CA Ravi Sisodia
(CA,CS,CMA)
(32226 Points)
Replied 07 November 2009
free samples A/c Dr. (at cost of samples)
To Trading A/c / stock / purchase (at cost of samples)
Jag Bhushan Sharma
(Faculty in a B-School)
(633 Points)
Replied 18 November 2009
In case a company is carrying on manufacturing, then it will bebetter if it maintains Manufacturing A/c as well as Trading A/c. In case raw material is distributed as sample, then entry should be Free Sample A/c Dr. to Manufacturing A/c/Purchases with cost of purchases amount.
But if finished goods are distributed as samples, then entry should be Sample A/c Dr. To Trading A/c at Cost of Sales.
Jag Bhushan Sharma
(Faculty in a B-School)
(633 Points)
Replied 11 January 2010
It is quite simple. All the accounts can be divided in four categories i.e Assets, Liabilities, Expenses and Incomes.
Rule I: In case of Assets Debit when they increase and Credit when they decrease.
Rule 2: Credit when Liabilities increase and debit when liabilities decrease. Treat Capital A/c as a liability.
Rule 3: Debit all Expenses and Credit all Incomes and Revenue.
AHAMED. B
(3 'C' - Final)
(273 Points)
Replied 22 January 2010
A/cing entry for free samples:
Free samples A/c Dr.
To Purchases A/c..
Here, it is assumed that samples are given out of purchased goods...
saranraj
(CA FINAL)
(419 Points)
Replied 22 January 2010
Entry is
Sales promotion expenses a/c Dr. xxxxxx
To Purchases a/c Cr. xxxxxxx
V P Narasimhan
(Accounts Manager)
(791 Points)
Replied 03 March 2010
In some Companies Free Samples has been treated as "Sales Promotion" a/c
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