Accountancy Question?

Question

Can anyone kind enough to tell me if the stock has not been posted in Sage. How to post openning balance and closing balance to reflect the diffrence. otherwise the dr and Cr entries will cancel each other on the nominal ledger.

Answer 1

Hi Dear,

Your question is very much incomplete, but still I will try to answer you. But better add few more things in your question (1) You are preparing full accounts or just final accounts (2) you are making computerised accounts or paper accounts (3) Is this the first year of the company or old balance sheet is also available.

Well, just take last years balance sheet, check the closing balance and put that balance on the debit side of Trading Account as a Opening Balance of Stock.

Find out Closing Balance of Stocks and put it on the Credit side of the Trading Account(Profit & Loss Account). Just forget the middle of the stocks.

It's senseless to put only difference as you can comfortably put opening and closing balance anytime. Even if you wish than, if opening balance is higher than the closing balance than difference will come on the debit side of p&l account or else on the credit side.

Theoretically there is no way to cancel opening and closing balance as closing balance arrive with "Opening Stock + Purchases(At cost) - Sales(At cost) = Closing Balance".

But practically an Accountant is the king as long as you manage to tally Balance Sheet and able to satisfy Company Auditors/Chartered Accountants.

Hope your query has solved, all the best.

Rahi
(N.B. don't forget to rate)

Answer 2

Stick in dummy figures for stock that make the balances right.

You can alwasys correct it later when the real stock data becomes available