Closing stock appears at rs.56, 000 after sales during the year on march 31, 2017. What would be this information regarded as
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Answer:
closing stock must be credited to the Trading account and must be added to the Assets
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The answer for this question is that the closing stock will be credited to the trading account and must be added to the assets here's an explanation on why
Explanation:
There are two main reasons on why we should do so:
- First, Cost of sales must be equal to the current year’s revenue and as the inventory at the end of the period has not been sold the company and thus should not be accounted against sales revenue, so it must be removed from the cost of sales. this is the reason why we remove closing stock from the total of the opening stock
- Secondly, so as to account for the inventory at the tip within the trading account, a closing entry is passed and so the closing stock seems at the method of accounting of trading.
To know more:
What is closing stock? (Answer in one sentence)
https://brainly.in/question/7034396
How to calculate closing stock??
https://brainly.in/question/1798038
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