CLOSING STOCK

This query is : Resolved

harpal singh (Querist)
Follow

15 April 2008 THERE WAS RAID BY IT DURING THE YEAR 2006-07. STOCK BY AMOUNT OF RS.00000.00 AND DEPOSIT TAX ACCORDINGLY. ( IT WAS U/S 133A) AND THE ASSESSEE MAKE THE FOLLOWING ENTRY STOCK A/C DR ( UNDER CURRENT ASSETS) AND CAPITAL A/C CR.

BUT AT THE TIME OF MAKING THE BALANCE SHEET AND TPL. THE ASSESSEE HAD TAKEN AS CLOSING STOCK IN THE TRADING ACOUNT.
THUS THERE ARE THREE ENTRY AS FOLLOWS:-

STOCK CREDITED TO TRADING A/C
STCOK CR. TO CAPITAL A/C
CLOSING STCOK UNDER CA IN BALANCE

WHETHER IT IS OK.

ABOVE ADDITIONS CREDITED TO CAPITAL AS DECALRED INCOME. U/S 133A.

QUERY :- AT THE TIME FILING THE ITR ASSESSEE HAS NOT TAKEN THE ABOVE ADDITION IN COMPUTATION OF INCOME. BUT DECLARED IN THE CAPITAL A/C AS ADDITIONS. WHETHER IT IS OK. IF NOT WHAT'S ACTUAL POSITION.

Chintan Gajjar

Chintan Gajjar (Expert)
Follow

27 June 2008 As we have already brought Closing Stock into the Books by following Entry,
Cl.Stock. Dr.
To Capital A/c
Hence,this Closing Stock will not affect profit & Loss A/c for the Current year. In case such Stock is sold, definitely we have to debit it to trading a/c. You can show Such Stock defferently then normal stock.
Regards,
Chintan

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok