Inventory

1) after the end of the Accounting period some goods which are sold to the customer is returned. The worth of sale return goods is make up prize of 300. Here make up prize is nothing but selling price - cost price. Here the profit margin is 1/3 on cost. So 1/3 of good is equal to 300. Therefore the worth of returned goods is 900 (i.e. 300x3).

Vijay K

CA Inter

★ 9K+

03-Oct-21 23:10

2) after stock taking, they have noticed that there is a slow moving good ( sells rarely ). It's worth is 1,125. To sell this goods out they have reduced its net realisable value to 525.

Vijay K

CA Inter

★ 9K+

03-Oct-21 23:13

3) we sold goods cost worth of 1,550 in the given accounting period which we have to deliver on a particular date. But due to some natural calamities we can't give the delivery of goods on time. Now the customer refused to take the delivery and return it to us. Now the net realisable value of that goods is 1,250 as on 31th March,2017.

Vijay K

CA Inter

★ 9K+

03-Oct-21 23:17

These are according to the best of knowledge. Correct me if I am wrong.

Vijay K

CA Inter

★ 9K+

03-Oct-21 23:18

Thank you

Thread Starter

Sejal Shivani

CA Foundation

★ 5K+

03-Oct-21 23:19

It is sells return Am I right?

Thread Starter

Sejal Shivani

CA Foundation

★ 5K+

03-Oct-21 23:25

What is the effect of this particular in the treading account?

Thread Starter

Sejal Shivani

CA Foundation

★ 5K+

03-Oct-21 23:27

Yes

Vijay K

CA Inter

★ 9K+

04-Oct-21 08:46

Adjustments required for Inventory valuation (1) sales returns of next year with Rs.300 mark up included in stock (2) slow moving stocks to be written down by 600 (ie. 1125-526) (3) stock to be written down by 300 to its realisable value (i.e. 1550 -1250)

Sudha Reddy

CA Final

★ 20K+

05-Oct-21 10:43