Consignment J.E in the books of consignor when goods are send on consignment Consignment to -------A/c Dr. Goods send on consignment When Expenses incurred by Consignor Cash A/c

When Expenses incurred by consignee Consignment to -------A/c Dr When Expenses incurred by consignee Consignment to -------A/c Dr. Consignee A/c When advance send to consignee by consignor Cash A/c / B/R A/c Dr. When commission is charged by consignee Consignment to--------A/c/Dr.

When sales are done by consignee Consignee A/c Dr When sales are done by consignee Consignee A/c Dr. Consignment to ------A/c When del credere commission is not given Consignment to ------A/c Dr. Consignee A/c For bank charges paid by consignor Consignment to ----A/c Dr. Bank A/c Cash send by consignee to consignor Cash A/c Dr.

For profit on consignment Consignment to ------A/c Dr For profit on consignment Consignment to ------A/c Dr. P&L A/c For recording of closing stock Consignment Stock A/c Dr. Consignment to ------A/c If goods are sent on invoice price Goode sent on consignment A/c Dr. For offloading load on closing stock Consignment to ------A/c Dr. Stock reserve A/c

J.E. In the books of consignee When goods are sent on consignment No Entry When Expenses incurred by Consignor When Expenses incurred by consignee Consignor A/c Dr. Cash A/c When advance send to consignee by consignor

When commission is charged by consignee Consignor A/c Dr When commission is charged by consignee Consignor A/c Dr. commission A/c When sales are done by consignee Cash A/c /Creditors A/c Dr. Creditors A/c When del credere commission is not given Creditors A/c Dr. Debtors A/c

Cash Sent by Consignee to consignor Consignor A/c Dr Cash Sent by Consignee to consignor Consignor A/c Dr. Cash A/c For profit/loss on consignment No Entry For recording of closing stock No entry For off loading load on closing stock/goods sent on consignment

Valuation of closing stock Cost of closing stock + Proportionate non recurring expenses

Normal loss Loss which is unavoidable No accounting treatment

Abnormal Loss Loss which is avoidable J.E 1. Abnormal loss A/c Dr. Consignment to ----A/c Insurance company A/c Dr./Cash A/c Dr. Abnormal loss A/c Abnormal loss A/c Dr. Consignee A/c (Commission given on sale of defective goods)

Q. David sent goods costing Rs Q. David sent goods costing Rs.5,50,000 on consignment basis to Devi on 1-1-2018 @7% commission. David spent Rs. 45,000 on unloading. Devi sold 85% of the goods received for Rs. 6,25,000, 10% of the goods for Rs. 85,000and she took over the balance @ 5% below the cost price and sent a DD for the amount due from her to David.

Q. William of Chennai consigned 300 chests of tea at Rs Q. William of Chennai consigned 300 chests of tea at Rs. 2,000 per chest to Johnson of New Delhi paying freight Rs. 4,000 and other expenses Rs. 2,000. Johnson sold 250 chests at Rs. 2,500 per chest on credit and 25 chests at Rs. 2,200 per chest for cash. Johnson spent for freight and octroi Rs. 3,000 and other expenses Rs.1,000. He remitted the amount due to William after deducting commission @ 5%, 2.5% overriding and 0.5% del credere commission (all on total sales). Johnson found that one customer to whom credit of 40 days were allowed paid only 4,800 out of the total amount of Rs. 5,000due from him in full settlement of account. Other customers paid the amount on due dates.

Q. Canodia oil mills Delhi consigned 500 tins of vanaspati ghee to Aggarwal Bros. Jalandhar. Each tins costs Rs. 132 @ Rs. 8 per kg. Canodia oil mills paid Rs. 50 as carriage , Rs. 250 as freight and 200 as insurance in transit. During transit 330 kg of ghee was accidently destroyed and insurance company paid Rs. 1,250. The damaged tins were sold at Rs.1,100 by consignee. 410 tins were sold at Rs. 150 per tin expenses being on godown rent Rs. 1,500 labour charges Rs. 500. commission 4% del credere 1%. 33 kg were lost due to leakage. Show necessary accounts in both the parties.