Describe the methods of determining the value of unsold stock of goods send consignment stock.how do you close consignment stock account?
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How does the unsold stock valued in case of consignment
ADVERTISEMENTS: If all the goods are not sold by the Consignee within the accounting period, then the unsold stock is brought into account by the Consignor. As usual, the unsold stock in the hands of the consignee should be valued on cost price or market price whichever is less.
Formula and format for computing closing stock on consignment
Cost of stock on consignment = (Total cost/Total number of units) × Units in stock.
Net realizable value = Market price of stock – (Expected expenses to be incurred to sell the stock + Consignee's commission)
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