15 June 2015
It will appear in opening balance sheet as it is closing stock of last year. The opening balance sheet is nothing else but closing balance sheet of last year. It will also appear in current year's Trading a/c as it is opening stock of current year. So what is the confusion?
16 June 2015
The opening stock is brought into the books of the current year with the opening entry (which are the figures of the closing balance sheet of last year): Various assets a/c Dr. (individually) Opening stock a/c Dr. To Liabilities a/c (credited individually) After the above entry is posted to the various assets & liabilities accounts at the beginning of the year, the opening stock account will show a debit balance. Entry for transferring opening stock at the end of the year will be: Trading a/c Dr. To Opening stock a/c After passing this entry the opening stock a/c will be closed. After physical stock taking & its valuation the entry for recording closing stock at the end of the year is: Closing stock a/c Dr. To Trading a/c The Closing stock a/c created at the end of the year will thus show a debit balance which is an asset and hence shown in the closing balance sheet.
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