Accounts

hi all of friends,

Please let me know if Books keeping are on cash basis and sales happened in march end of year and payment received in next month that is april which is next financial year then what adjustment entry should be passed for sales of debtors. in the case of cash basis system follows.

 

Replies (4)

When it is a cash basis system of accounting , then there is no need to pass any entry.

You will not be pass any entry of this condition.

no even sale to debtors

nidhi i think u r confused, if u r keeping ur records on cash basis it means u record sales when payment is received and not on delivery of goods.  now there is no need of any adustment entry to be passed on 31st of march. bcoz u have not recorded any such sale. instead u would have prepared a mamoranda of such sales. one more thing i want to say that u have to include the Cost of such stock/material in the value of Closing inventory as stock lying with customer.

NB: Cash System is not allowed to a manufacturing/trading concern

Regards,

CA Naveen Kumar Agrawal 

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