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Final accounts Non manufacturing

In the sixth video sir said about closing stock adjustment Op +purchases - Cs = Cost of goods sold Is COGS AND SALES SAME IF SO WHY COGS IS GIVEN ON DEBIT SIDE OF TRIAL BALANCE


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

14-Sep-20 13:07

15

Answers (15)

Closing stock should show credit balance in trial balance no sir but why is on debit side


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

14-Sep-20 15:34

Closing stock is an asset and will have a debit balance.


Suraj Lakhotia

Suraj Lakhotia

Admin

14-Sep-20 16:43

Closing stock is an asset and will have a debit balance.

Both opening and closing stock also has debit balance. But one is on debit side and the other is on debit of profit and loss account


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

14-Sep-20 16:51

Also reply for the forum kept before


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

14-Sep-20 16:53

Both opening and closing stock also has debit balance. But one is on debit side and the other is on debit of profit and loss account

Opening stock is generally given in TB. Closing stock in adjustment. When you bring the adjustment in final accounts, entry is Closing Stock (Dr) [Asset account] To Profit and Loss Ac.


Suraj Lakhotia

Suraj Lakhotia

Admin

14-Sep-20 17:10

Even the entry is same when we transfer opening stock to trading account


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

14-Sep-20 17:12

Even the entry is same when we transfer opening stock to trading account

Trading A/c Dr To Opening Stock.


Suraj Lakhotia

Suraj Lakhotia

Admin

14-Sep-20 17:15

Trading A/c Dr To Opening Stock.

Is cost of goods sold and sales same


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

15-Sep-20 16:29

Is cost of goods sold and sales same

No. One is cost and other is income.


Suraj Lakhotia

Suraj Lakhotia

Admin

15-Sep-20 16:52

No. One is cost and other is income.

But in trading account we have OS +PUR+D.E ON DEBIT SIDE AND CLOSING STOCK on credit side which means if closing stock is reduced we should get the amount equal to sales Even formula for cost of goods sold is also same So why these two are different


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

15-Sep-20 16:57

Gross profit?


Suraj Lakhotia

Suraj Lakhotia

Admin

15-Sep-20 17:00

Gross profit?

If we add sales and closing stock and deduct the debit items said above we get gross profit But if we keep aside sales and deduct only closing stock from the debit items we get amount of sales


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

15-Sep-20 17:04

No. You will not get. You can put some numbers and see.

Ok sir If we have to pay rent to A in this year which is is not paid Can we write RENT A/C To A or only rent a/c to rent payable


Prasanth kumar Kamisetty

Prasanth kumar Kamisetty

CA Foundation

11K+

15-Sep-20 18:07