Final accounts

Himanshu Somani

You just have to calculate the value of stationery consumed and debit to P/L : Opening stock+ any direct expenses - closing stock

Thread Starter

Why.exp acc credit ??

Himanshu Somani

See when you would have prepared Individual expense account then you would have have debited such amount (relating to inventory) and now you have to credit expense account as ultimately the expense booked is directly related to inventory so the cost of inventory has to increase ...i.e., the entry will be Inventory ac dr To expense a/c

Himanshu Somani

See when you would have prepared Individual expense account then you would have have debited such amount (relating to inventory) and now you have to credit expense account as ultimately the expense booked is directly related to inventory so the cost of inventory has to increase ...i.e., the entry will be Inventory ac dr To expense a/c

Thread Starter

For what assets this treatment is applicable, ie, value consumed debit to p&l acc . ??