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Return of expiry goods

Accounting Entries 1906 views 4 replies

Dear Friends

 

If any body can clear my view i will be happy.  My Query is that how can we give the entry for the Expiry stocks return from parties.  The sale transaction happened for the last 2 years back where the expiry stocks received after two years.

1) I want conclusion that if the same expiry stocks received by the Manufacturers how the entry will be given. 

2) If the sale returns of expiry goods can be adjusted to the current year sales?

3)  If the expiry goods received by the manufacturer, how can they give entry in their books, I mean cost of expiry goods       can be booked as a expenditure separately or can be adjusted to current year sales.

4) Request to provide the Entry formation in the books of Accounts.

With Regards

Sreenivasa rao

 

 

Replies (4)

expired goods cant be treated as sale return as they are defective now so they should be shown in p&l as damaged goods are shown.

if you receive the expired goods, you reverse the sale, because the customer will not pay your money for the goods return.

at the same time the goods cannot be resale out, so you transfer the cost of the goods to demages goods and reduce your stock.

- Ashok

as per AS -5 it shd be shown in trading a/c as closing stock and dr in the p&l a/c

Expire / damaged stock returned by customer can be treated as sales return and the current years sales may be adjusted. However the disculosure shoud be made if the impact of previous years sales return is material.


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