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Why is abnormal loss credited to consignment a/c?
If consignment a/c is an nominal a/c then shouldn't losses be debited? Pls help.
Replies (4)
Because, consignment account is kind of trading account. Effect of abnormal loss is not reflected in it.
That's why we reverse its effect by crediting here and debiting such account in profit and loss account.
Oh i see..thank you.
you're welcome
.
But when consignment account is being credit, won't it will increase the profit of consignment business?
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