[5] A firm has stationary stock amounting to Rs 400 as at the end of fnancial year.
Accountant of the firm has written it off to profit & Loss A/c. Is he right in doing so?
Justify the Answer.
Answers
He is right if such purchase were done as expenses and accounted as expenses.
But in that case there is no writing off required as they are already accounted as expenses.
The stock can just remain there without any accounting entries.
Any companies are opting to account many purchases as expenses as they do not have much values after a year.
For example many companies account calculators as expenses.
He is right if such purchase were done as expenses and accounted as expenses.
But in that case there is no writing off required as they are already accounted as expenses.
The stock can just remain there without any accounting entries.
Any companies are opting to account many purchases as expenses as they do not have much values after a year.
For example many companies account calculators as expenses.