Plz reply - Inventory value

can u tell me, what kind of standards company wants to meet ?

Can you explain the scenario in detail. Cc you said the standards are not met, it means whether you may 've to return the Inventory back?

If the provision amount is only with respect to the contingent payment then it can ve.well e reversed.

Kindly explain the case in full??

Instead of having created a provision entry as

Inventory A/c Dr

     To Provision A/c

you could 've created a provision entry like this

Party A/c Dr

      To Provision A/c.

So that Subsequent Provision reversal when standards are not met will not affect the inventory value.

If you agree with this you will have to pass three entries subjecting to the amount of contingent payment.

1st: Provision A/c Dr

           To Inventory A/c

        (to the extent of such amount)

2nd: Party A/c Dr

             To Provision A/c

         (Rectification of wrong entry previously passed)

3rd: Provision A/c Dr

             To Party A/c

        (Now reversal of 2nd entry since standards are not met)

Provide a transfer entry...

Provsion (old) Dr.

to Incentives ( new a/c opened )

this will keep the velue of inventory intact :)

i think provision is an error

if it is error then it is a PRIOR PERIOD ITEM.

Provisions a/c

         To Inventory ( upto the value of inventory

          To Gain on Provisions ( transfered to P & l a/c)

yes i agree with aparna

AGREE WITH APARNA

Can anyone tell me is PF Act applicable to wholesale traders dealing in Stationery Products,Computer dealers(like in nehru place),...can any one explain this to me

Originally posted by : Prateek
	Can anyone tell me is PF Act applicable to wholesale traders dealing in Stationery Products,Computer dealers(like in nehru place),...can any one explain this to me

twenty or more persons employed on any previous day will make the establishment liable to cover and pay under Provident fund.

Originally posted by : Prateek
	Can anyone tell me is PF Act applicable to wholesale traders dealing in Stationery Products,Computer dealers(like in nehru place),...can any one explain this to me

if such dealers are depositing the pf dues for their employees the such act also applies otherwise not

inventory      dr

to provision a/c

is insane, how can u increase ur inventory value for a contingency,  if it was a clause provided in the invoice/sale document, and its occurence was more likely than not, they should have raised a provision debiting the p&l a/c or the related exp as an o/s exp, if  they start raising inventory values for contingencies, profits may be inflated/ deflated and it ll be hard to find a loss making unit .

agree with Arpana

hi aLL and i appreciate understanding of mudassar.....provision is always made from p/l ....

now i assume that you can't change the entry pass earlier for making the provision from inventory....

now u immediately pass an entry 

1)
Provision a/c dr

To suspense a/c

and wen u got the sufficient balance in inventory a/c..then 

2)

Suspense a/c dr 

to Inventory...

because we also need to corrct the inventory a/c......so that it shows the real physical inventory stock with u....

pls write if u had any confusion....