kundan singh (99 Points)
05 May 2019
Swami Ayyappa Nuli
(TAX ADVISOR & CONSULTANT AT G.S.T SUVIDHA CENTER)
(1372 Points)
Replied 05 May 2019
We have two types of losses for accounting purposes. 1.Normal loss and 2.Abnormal loss. Normal loss need not to be accounted separately. Abnormal loss to be accounted via Journal entry. In case of Abnormal loss, you need to follow two steps.
1.Increase value of closing stock by purchase value (In case where F.M.V of closing stock higher than purchase value) of abnormal loss items. Example: Unit purchase vale of Abnormal lost item is Rs.1000. Two units are Abnormal loss then add 2000 to value of physical stock. Then reflect revised closing stock value in Trading account.
2.Abnormal loss must be accounted through profit and loss account. Create Moisture loss(Abnormal) under grouping- Indirect expenses and following journal entry must be observed.
By Moisture loss(Abnormal) A/c Dr To Purchases A/c
Due to this entry, Any G.S.T claim as ITC will also reversed
Swami Ayyappa Nuli
(TAX ADVISOR & CONSULTANT AT G.S.T SUVIDHA CENTER)
(1372 Points)
Replied 05 May 2019
We have two types of losses for accounting purposes. 1.Normal loss and 2.Abnormal loss. Normal loss need not to be accounted separately(No inventory case). Abnormal loss to be accounted via Journal entry. In case of Abnormal loss, .Abnormal loss must be accounted through profit and loss account. Create Moisture loss(Abnormal) under grouping- Indirect expenses and following journal entry must be observed.
By Moisture loss(Abnormal) A/c Dr To Purchases A/c
Due to this entry, Any G.S.T claim as ITC will also reversed
Previous post had an error. Hence please consider this post. No two steps needed, Just one single entry as aforesaid need to be implemented. What is normal loss or abnormal loss shall be based on industry standards
25 Hours GST Scrutiny of Return and Notice Handling(With Recording)
Survey, Search and Seizure under Income Tax Act 1961
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