Consolidation adjustment

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
can anyone explain what i would do when say y/e is 31 march and a company with two divisions transferred goods worth £30,000 between themselves. i understand that you minus the £30,000 from both sales and purchases(COS) but what would happen if they didnt receive the goods until 2 April?? this is in transit but how do i write it?

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Consolidation adjustment

    Could you explain a little further? Are you saying you don't know what year the reversal should be in?

    I don't see how it would make a difference as whether its in one year or the other it gets reversed.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Consolidation adjustment

    Hi
    Not sure if you have sorted this yet,but college told us to treat the goods as though they had not been transported yet when dealing with intercompany accounts and a cross over at year end.

    You show the stock as still belonging to the company it was despatched from, and has not being yet received by the company it was being despatched to.

    Hope this helps.

    Tracy

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