mridul savio Pinto (articled trainee ) (1477 Points)
01 June 2011what is the correct journal entry for goods sent on approval basis ??
in module it is given
sundry debtors a/c dr
to sales
but in mock test cd its answer is
customers a/c dr
to goods sent on approval
which is correct ??
nd what will be the entry for purchase of goods sent on approval in buyers books
whether it is
sale a/c dr
tto
sale on approval basis ??
C.A.M.S.ROY
(C. A.)
(478 Points)
Replied 01 June 2011
When goods is sold on approval and return basis, the sale is recognised when it is accepted by customer or expiry of specified period if customer unable to reject the goods
Customer a/c -dr, TO Sales a/c , if goods accepted , no further entry is required,
if goods rejected or waiting for approval , the above entry is reversed , an goods waiting for approval is treated as goods lying with customer.
If goods sent on approval a/c is credited, the another entry is required when good approved by the buyer ,
Goods sent on approval basis- Dr., To sales A/c
In the Books of Buyer, entry will be
Purchases A/c-dr
To Creditors a/c
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 01 June 2011
customer ac.- -- - - -- - - -- - dr.
to goods sent on approval basis
when goods r approved
goods sent on approval basisac - -- - -- - -dr.
to sales ac.
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 01 June 2011
goods sent on approval basis will be shown under the head closing stock at the year end
CS,CA F,Numrologi TusharSampat
(CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert)
(85930 Points)
Replied 01 June 2011
| Originally posted by : future ca | ||
 |
customer ac.- -- - - -- - - -- - dr. to goods sent on approval basis when goods r approved goods sent on approval basisac - -- - -- - -dr. to sales ac. |
 |
Agree to this
mridul savio Pinto
(articled trainee )
(1477 Points)
Replied 02 June 2011
but in the material it is given other way .... it isgiven customers a/c dr to sales a/c
mounika
(semi qualified chartered accountant)
(981 Points)
Replied 02 June 2011
customer a/c---dr
to sales a/c
is direct entry
shakuntala chhangani
(FCA Course co-ordinator WIRC coaching centre)
(2525 Points)
Replied 04 June 2011
Hi dear friends, very few days are left for exams. so read the modules properly. U will find that there are three methods of recording goods on approval method. the above question is based on last method "When the business sends goods numerously on sale or return basis".
under this method, two memorandum books are opened - Sale or return day book and sale or return ledger. ledger contains accounts of individual customers and sale or return total account (i.e. goods sent on approval account).
when the goods are sold on approval basis individual customers account is debited and total account is credited with total sale on approval for the period.
hence the above entry in institute's cd is correct.
Regards, CA Shakuntala Chhangani
Divya
(Article Assistant)
(37 Points)
Replied 12 November 2011
CAclubindia
