Closing stock is not tb???
This query is : Resolved
Amol S Joglekar
(Expert)
28 March 2016
Goods account as is formulated in the initial stages of accountancy (say 11th std....PUC as is called in the southern part of India) takes care of purchases and sales. (In the subsequent years, we do formulate Purchase account & Sales acount separately) So to say, till finalisation, there arises no need to make any ADJUSTMENT entries.
Adjustment entries do NOT find any room in trial balance so is true for the CLOSING STOCK.
However, please note, in computer environment (say Tally software)..... one can get the adjustment entries POSTED on 31st Mar and then get the trial balance.... obviously with Stock as well)
At the time of finalisation, the need for ADJUSTMENT entries creep in e.g. paid in advance (pre paids), received in advance (pre receipts), paid in arrears, received in arreas etc.
Adjustment entries do NOT find any room in trial balance so is true for the CLOSING STOCK.
However, please note, in computer environment (say Tally software)..... one can get the adjustment entries POSTED on 31st Mar and then get the trial balance.... obviously with Stock as well)
At the time of finalisation, the need for ADJUSTMENT entries creep in e.g. paid in advance (pre paids), received in advance (pre receipts), paid in arrears, received in arreas etc.
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