What will be an accounting treatment if Company having business of selling Home appliances
And out of those 1 no. Refrigerator used for staff company accommodation
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Own product used for company staff
Replies (5)
Put it into admin expenses and reduce inventory.
Admin a/c
To Inventory a/c
I think people derecognise purchases in trading account method, it is not necessary in cos method.
Or we can show fixed asset also
No it will be not shown as fixed assets.
It will be shown as staff's accommodation assets and shown in staff's ledger
It will be shown as staff's accommodation assets and shown in staff's ledger
All right now I got it, it can be like
Admin exp a/c
To Purchases a/c
and
Accommodation Asset a/c
To Inventory a/c
I forgot one more point, this Purchases is a pain to account for as it does not cover the production costs of finished fridge.
so another entry
COS a/c
Loss on fridge
To Inventory a/c
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