What is the journal Entry for goods sold as samples?
If you give goods as sample it is business promotion expenditure.
Journal entry.
Business promotion A/c Dr xxxx
To Sales A/c xxxx
(Being goods given as samples.)
This will inturn increase expenses and increase income. Actually there is no need for entry. But we need it for the purpose of internal control and Showing Proper GP Ratio. Who ever maintains inventory also in books then they have to pass this entry.
triumph-CMA
(Chartered Accountant)
(503 Points)
Replied 07 November 2009
Dear Sathya
Goods distributed as sample, goods lost, goods taken for personal use and distributed for charity are always recorded at cost. So it is better to credit Trading a/c or purchases account instead of Sales account. Entry is made at cost.
triumph-CMA
(Chartered Accountant)
(503 Points)
Replied 07 November 2009
This is so becouse these transactions are not made with any intention to earn profit.
sivaram
(Asst Mgr-Taxation)
(6918 Points)
Replied 07 November 2009
Thanks Mr Dhirendra singh for your valuable reply
Deepak Jain
(CA Final Student)
(514 Points)
Replied 07 November 2009
Agree with dhirendra. should be entered at cost
CA Parth Shah
(Chartered Accountant)
(369 Points)
Replied 07 November 2009
yes..naturally.
Goods given as samples A/c Dr.
To Trading A/c
Abhay
(1)
(123 Points)
Replied 11 November 2009
ntry will be
goods distributed as free sample Dr.
To purchase a/c
P&L a/c dr.
to Gods as free sample a/c
CA Himanshu Bansal
(Risk Manager)
(2345 Points)
Replied 19 November 2009
Goods Distributed as Free Samples A/c Dr. -----
To Purchase A/c -------
&
P & L A/c Dr. -------
To Goods Distributed as Free Samples -------
manoj sharma
(Instructor & Accountant)
(43 Points)
Replied 28 November 2009
Sample A/c dr.
Goods Purchase a/c cr
manoj sharma
(Instructor & Accountant)
(43 Points)
Replied 28 November 2009
Sample A/c dr.
Goods Purchase a/c cr
CA. Rishabh Mittal
(CA in Practice)
(1077 Points)
Replied 29 November 2009
| Originally posted by :Abhay | ||
| " | ntry will be goods distributed as free sample Dr. To purchase a/c P&L a/c dr. to Gods as free sample a/c |
" |
This should be the correct entry
CA Rahul Jain
(CA)
(1162 Points)
Replied 30 November 2009
it is better to credit the purchase a/c instead of crediting the trading a/c.
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