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Envolep and A4 paper stock

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Atharv Sankliya

1359 Points Posted on 19 June 2022

a company has stock of envelope and A4 paper of rs 200000 they use envelope and paper for invoice what are its treatment does the stock of it is assets ? and how to find its yearly consumption ?

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Quick Summary

This discussion explores the accounting treatment of envelope and A4 paper stock. If a company's main business isn't selling these items, they are typically treated as printing and stationery expenses charged to the Profit and Loss account. While not usually reported separately in financials, internal controls can help estimate consumption based on sales targets or past trends.

CA. ANKIT PANDYA

682 Points Posted on 20 June 2022

What is the Company's Main business?, I mean does it sells envelopes & Paper?

If no, then it should be charged to PnL as Printing & Stationary expenses. in such case, you will not be required to report consumption of it any where in financials.

However for your own internal control purpose you can derive the estimated consumptions based on budgeted Sales / Target sales for that specific period. Past trends can also help in this regards.