Question

describe the methods od determoning the value of unsold stock og goods send consignment stock account?​

Answer 1

Formula: Calculation of Value of Unsold Stock:

It is calculated as follows:

(a) The proportionate Cost Price and

(b) Proportionate direct expenses i.e. the expenses incurred by the Consignor and Consignee till the goods reached the godown of the Consignee.

Expenses incurred by the Consignee after the goods have been brought to the shop/godown are not considered. Correct profit or loss can be ascertained by the proper valuation of unsold stock which is credited to Consignment Account.

Value of unsold stock = Cost Price of Closing Stock + Proportionate non-Recurring Expenses