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Goods sent on consignment is it a transaction or event??. As goods sent on consignment does not transfer it's ownership only possession is changed


VIJAYA SARADHI MAGANTI

VIJAYA SARADHI MAGANTI

CA Foundation

850

31-Jul-20 11:49

63

Answers (6)

Event. When the consignor sends goods to the consignee, there is no need to create an accounting entry related to the physical movement of goods. It is usually sufficient to record the change in location within the inventory record keeping system of the consignor.


sudha reddy

sudha reddy

Moderator

03-Aug-20 09:26

sudha reddy Moderator

Event. When the consignor sends goods to the consignee, there is no need to create an accounting entry related to the physical movement of goods. It is usually sufficient to record the change in location within the inventory record keeping system of the consignor.

But we pass entries like Consignment to mr.x a/c ...Dr To Goods sent on consignment a/c Goods sent on consignment a/c .....Dr To purchases or trading a/c Can you please explain this to me? Thanks for the reply


Thread Starter

VIJAYA SARADHI MAGANTI

VIJAYA SARADHI MAGANTI

CA Foundation

850

03-Aug-20 09:33

Thread Starter

VIJAYA SARADHI MAGANTI

But we pass entries like Consignment to mr.x a/c ...Dr To Goods sent on consignment a/c Goods sent on consignment a/c .....Dr To purchases or trading a/c Can you please explain this to me? Thanks for the reply

These are for control purposes and to track the transactions with consignee..... inventory is adjusted only when sale is made and trial balance is affected only for final sale and commission due


sudha reddy

sudha reddy

Moderator

03-Aug-20 09:39

sudha reddy Moderator

These are for control purposes and to track the transactions with consignee..... inventory is adjusted only when sale is made and trial balance is affected only for final sale and commission due

Thank you very much mam for timely reply and clarifying my doubt. Whether stock with consignee effects trial balance?? If you don't mine I have another doubt which is quite similar When bills receivable is sent for collection when record it even if no ownership is transferred in bills to bank and we consider bank as a debtor and debit bills sent for collection. Can you please explain this for me.


Thread Starter

VIJAYA SARADHI MAGANTI

VIJAYA SARADHI MAGANTI

CA Foundation

850

03-Aug-20 09:46

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