Stock arrangement

CA Devanand Jethanandani (CA) (8003 Points)

14 March 2014  

A Ltd. has to sale goods to B Ltd., but the stock of goods of A ltd. exhausts, so for temporary arrangement delivery of goods happens from C Ltd. (on A Ltd's behalf). When A Ltd. will have enough stock (after purchase) it will transfer that goods to C Ltd.

Now my question is what will be accounting entries for these stock movements in the books of A Ltd.,

1 when A ltd. sale goods to B ltd and

2. when A Ltd. gives back goods to C Ltd.