27 May 2015
Closing stock is recorded in the books by passing the following entry: Closing stock a/c Dr. To Trading a/c What you see in the trading account is the posting of the of this entry on the credit side of that account. The debit effect gets posted to the debit side of Closing stock account which is a real account or an asset. This account has a debit balance and is shown in the balance sheet.
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