What is the type of principal for CLOSING STOCK. and why we
show closing stock two time that is once in trading account
and another time in assets. if closing stock is Real
account than what about showing in trading account as we
dont show real account type in trading account. thanks
- 6 Answers
- 16342 Views
- DuPont, I also Faced
- E-Mail Answers
Answer Posted / ruben
Closing is stock is a Real Asset in true terms as it has a
value as on a particular date ( Stock concept of
accounting) and as such it is shown in the Asset side of
Balance Sheet.
The idea of Showing the same in the credit side of Trading
A/c is following the Matching Principle/Matching Concept of
Accounting as this has the effect of arriving appropriately
at the Cost of Sales.As the debit side incorporates Opening
stock + Purchases and the credit side has the Sales figure,
appropriate matching of REVENUES to COST INCURRED TO EARN
THAT REVENUE will not happen unless Closing Stock features
in the Credit side of the Trading Account
| Is This Answer Correct ? | 16 Yes | 0 No |
Post New Answer View All Answers
what is the diffrence between cash flow & cash fund?
Expenses which are incured during the manufacturing are direct expenses.In that case,what are the direct expense in a trading firm where there is no production.Like salary, rent, electricity etc in a trading firm
What software applications have your used for accounts receivable?
wat is mass allocation and when it is used
What steps would you take to locate the errors in case trial balance disagrees?
What is a business transaction in accounting?
Sales tax waybill is required for how much value of invoice (for example we raise Rs.1000 bill is waybill required in andhra pradesh)
My Brother is running a small business of Window glasses & Mirror etc. He needs Bank Loan (CC/OD Limit)against current account. So, I need a project report to apply CC Limit. Please Help me. My EMAIL ID is :- savichawla_1703@yahoo.co.in Kindly send the report to above ID ASAP. Thanks & Warm Regards Sarvpreet +919888669523
What will be the entry when deduct ESI @1.75% from the employees salary?Same as in the time of ESI of employer part @4.75% in tally posting? In PF posting in tally what will be the entry ?
dear sir,how to maintain petty cash book. its voucher and posting on cash book and ledger A/c?
Tell me about an invoice discrepancy you discovered and how you resolved it
when receieve cheque from a party and we deposite cheque in bank how do this entry
how to individual capital account.
What are the nine accounting cycles?
Payment Blocks . What is "A" and "R" Blocks in Account payables.. ??
