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Consignment Accounting Solution

The document outlines the journal entries and ledger accounts for Raja Mills Ltd. related to a consignment accounting problem. It details the transactions involving goods sent on consignment, expenses incurred, sales made, and profits transferred. The entries include debits and credits for various accounts such as Consignment A/c, Fancy Stores A/c, and Bills Receivable A/c.

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84 views1 page

Consignment Accounting Solution

The document outlines the journal entries and ledger accounts for Raja Mills Ltd. related to a consignment accounting problem. It details the transactions involving goods sent on consignment, expenses incurred, sales made, and profits transferred. The entries include debits and credits for various accounts such as Consignment A/c, Fancy Stores A/c, and Bills Receivable A/c.

Uploaded by

theuniverseboss884
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Solution to Consignment Accounting Problem

Journal Entries in the Books of Raja Mills Ltd.

Particulars Debit (Rs.) Credit (Rs.)

Consignment A/c 60,000 Being goods sent on consignment (100 x Rs. 600)

Consignment A/c 2,500 Being expenses paid by consignee (1,000 + 1,500)

Bills Receivable A/c 30,000 Being bill drawn and accepted by consignee

Bank A/c Being bill discounted

Bank A/c 78,000 Being sales made by consignee

Consignment A/c 3,900 Being commission due to consignee

Fancy Stores A/c 2,500 Being expenses paid by consignee transferred

Consignment A/c 11,100 Being profit on consignment transferred

Ledger Accounts

Consignment A/c

Particulars Debit (Rs.) Credit (Rs.)

To Goods Sent on Consignment A/c 60,000 By Fancy Stores (Sales)

To Cash/Bank A/c (Expenses) 2,500 By Fancy Stores (Expenses)

To Fancy Stores (Commission) 3,900 By P&L A/c (Profit)

Fancy Stores A/c

Particulars Debit (Rs.) Credit (Rs.)

To Consignment A/c (Sales) 78,000 By Bills Receivable A/c

To Consignment A/c (Commission) 3,900 By Bank A/c

To Consignment A/c (Expenses) 2,500

Bills Receivable A/c

Particulars Debit (Rs.) Credit (Rs.)

To Fancy Stores A/c 30,000 By Bank A/c (Discounted)

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