Question

what is the treatment of goods distributed in free samples​

Answer 1

The goods distributed as free samples do not have a sales value and therefore cannot be recorded in the accounting records as sales. The free product samples do however have a cost which needs to be removed from the cost of sales account and recorded as an expense.

Answer 2

Answer:

Since the goods are generally distributed as free samples for sales promotion, the amount of such goods will be debited to the P & L A/c. as “ Advertisement Expenses A/c.” 2. The amount of such goods will also have to be deducted from “Purchases” to complete the double entry in the trading account.