Treatment of goods not received till last day of fy?

Nitin Singhal (Gaining knowledge...) (320 Points)

16 September 2012  

Hello Friends,

Placed below is a query relating to accounting treatment of Goods not received by us till last day of Financial Year:

A company, say X Ltd. (situated in New Delhi), gave advance for sending certain goods with a company, say Y Ltd. (situated in Chennai), on 29th March 2012 on the condition that remaining payment will be made after receiving of goods. Y Ltd. despatched goods on 31st March 2012 but they were received in New Delhi only on 4th April 2012. Now we are preparing Balance Sheet as on 31st March 2012 for X Ltd. What should be the accounting treatment of this situation in X Ltd.'s books?