Valuation of free goods.

This query is : Resolved

keshav (Querist)
Follow

24 January 2013 Hi.. anyone plz answer this query..

How to value the free goods received from supplier along with purchase?

How to value them in closing stock and at the time of sale?

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

24 January 2013 The value is zero. Make the entry in the stock register accordingly in Quantity column and value column.

keshav

keshav (Querist)
Follow

24 January 2013 Amol sir , but how to treat when the same is sold or is in closing stock?

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

24 January 2013 Stock register will have that item. The quantity is recorded in the stock register. At the time of sale, pass the entry as usual.

keshav

keshav (Querist)
Follow

24 January 2013 hello sir,

If i have purchased 10 items at 10rs each and got 2 free.
I made a sale of 5 items at 12 each, then wat would be the amount of closing stock..?

keshav

keshav (Querist)
Follow

24 January 2013 hello sir,

If i have purchased 10 items at 10rs each and got 2 free.
I made a sale of 5 items at 12 each, then wat would be the amount of closing stock..?

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

24 January 2013 12 items for INR100. That is the stock value. 7 are remaining. Value it on average cost basis. 700/12. You may also go by LIFO or FIFO. Choice is with you.

Message likes : 1 times

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