!

1""11

·ts of a product costing ~300 each to Chandan. He incurres ,,, 6000

·n11S 1, 00 Un•U •·ts of the pro d uct are sto I en m
. transit
· Chandan rece· ' th
s1r,- 2 60 n . · wes e
· ,lc.ll''°0 . .rneoses- Units at f460 per Umt. Expenses incurred by him amou t d
~ _..; ae eJ"r d sells 1t,020 . He reports a normal loss of 24 Units. n e
8 Cllr113e. o0ds aJJ being Non-recurrmg.
for 'fig g . aJJJOUP
,.elll~ill1 tbe eoure rrnal loss and closing stock.
f)60,
to ( fi.lld tlJe\13
. Jue of AbDO (BU, 2nd semester, B.com, May/June 2 014).

--~ -
,.,, I
..
.,,,...... particulars
Qty. Amou.ntro
1,200 3,60,000
consignment (1,200 x 300)
G00
ds sent on ·ng Expenses of Consignee carriage Ex- - 6,000
(+) r.on-recurrt
pen¢ . 1,200 3,66,000
al Loss in Transit
- -
(·) Nonn
. (3,66,000 60
(·) Abnormal Loss in Transit 1,200 x . ,
J 60 18,300

1,140 3,47,7000
Goods received by consignee
Abnormal loss is 60 Units, oH 18,300 I

ii, :PfJT'Wtl'l'I"ii•••M :unn,• • m -

---
t• . . . . .

Qty. Amountro
Particiilars
1,140 3,47,700
Goods received by consignee
- 4,260
(+) Non-recurring Expenses of Consignee
1,140 3,51,960
(·) Nonna! Loss in Godown
(·) Abnormal Loss in Godown 24 -
- -
1,116 3,51,960
- -- Goods.available for sale I'

"rrm,..,,1'3,a•1ml1N§§hi·•Si·l,Hi4··r·
"''I
-
'

Unsold stock -- Goods available for sale - Actual goods sold

= l,l1 6 - 1,020 = 96 Units.

Closing stock"' Goods available for Sale ( in ~)
Goods availabl e ,or
.- Sa1e (·m Qty.) x Unsold Stock

- 3,51,960
. - ~X96
.. Closin
g stock= 30,276
 ~ __.
]
4111@,iM,biiitP---------
ALtd .• Bangalore consiged 1,500 units Costing f5,000 each to M Ltd., Mangalore. The Con .
Paid f7 5 ,000 towaffls Freight Cha.-ge< and Insurance '30,000. Dudng transit It was fou:~1:n,,
10 units were damaged and Insurance. Company. settled the claim for ~45,000. M Ltd · r eceithat
the balanced consigned goods and paid unloading charges ~14,900. M. Ltd. sold 800 u . Vec1
Cash at 6 ,500 and 450 units on Credit f 7,000 each. nits for
Calculate Abnormal Loss and Closing Stock.

41.j.Y,i•t-
T > •
Qty. Amount«]
Particulars
1 5 00 75,oo.ooo
Goods Sent on Co nsignment (1 ,500 x 5,000)
( +) Non-recurring Expenses of Consignor
75,000
Freight Cha rges
.3JLlill.O_ t - - - - - - - + - - ~1 . u05,ooo
Insura nce 1500 76,05,ooo

(-) Normal Loss in Transit

. T . (76,05,000 ) 10 50,700
- A b norm aI Loss
() m rans1t 1,soo x 10
1490 7 5,54,300
Goods Received by Consignee

..,tHidiitfflMIM:l·ii&4
Qty. Amountm
Particulars
1490 75,54,300
Goo ds Received by Consignee
( +) Non-recurring Expenses of Consignee
14,900
Unloading Charges
1490 75,69,200

(-) Normal Loss in Godown

(-) Abnormal Loss in Godown
1490 75,69,200 ,
Goods Available for Sale

c
MMONMMMIM:l0-il-M64i ,
lt Unsold Stock= Goods available for Sale - Actual Goods Sold
t
= 1,490 - (800 + 450)
• = 240 units

!
i
Closing Stock = Goods available for Sa le ( in t )
Goods availa ble for Sa le( in Qty. ) x Unsold Stock
 C
! I
- ~ x 240
I~
- 1,49 0

. srock==lZ,19,200
e1os1ng
50,7 00
Abnormal Loss
45,000
(·) Claim settled
bnormal Loss 5,700
ActU 3 IA

'- .onsigned
111baY c 400 packages
. of Coffee
. to K on Kanpur. The cost 0 f eac h package was
aof 80Asulll offZ ,ooo was paid towards
. . and insurance by B· In th e trans1t
freight . 60 packages
f300, amage d. However, the consignor received t400 for the damaged p ac k ages fr om the
were d
nee company.
1nsura . ee accepted a BIii• of exc h ange or t60,000 for 60 days as an advance to 8 fB b
rhecons1gn . . o om ay.
·ng statement from the consignee disclosed the following information
U .
es were sold at B60 pre package.
2sopackag
They also paid a,400 towards Godown Rent, n,ooo for Carriage outwards and t 3 ,400

towards Clearing Charges.

r.alculate Abnormal Loss and Closing Stock.
Ans. [Abnormal Loss= n 7,500 (U 7,900 - f400); Closing Stock= US,900]

dill•
ofCbennai consigned 2,000 chairs to Chandran of Calcutta at an invoice cost oH300 each. Mohan
Mohan
paidfreight ~20,000 and Insurance fJ,000. During the voyage 200 chairs were totally damaged by fire
aod bad to be thrown overboard. Chandran took delivery of the remaining Chairs and paid {28,000
as customs duty. He sold 1,600 chairs at f440 each after incurring expenses on Godown Rent and
Advertisement Amounting f 4,000. Calculate the value of Abnormal Loss and Value of Closing Stock.
at
(B.Com., M.KU.)
t
Ans. [Abnormal Loss= {62,300; Value of Closing Stock= {65,500] f
li\Uiii r ["
Sudbee nd ra ofBangalore consigned 1,000 cases of goods to Radhesh of Mysore to be sold at his
°
nsk. The Cos t f Case of Goods was H50 the consignor paid freight and msurance
• Amounting
· I
II
I I

I
'.0 iB,OOO. Radhesh informs Sudheendra that he has sold 800 cases at f220 each. Expenses
incurred
H. b YRadhesh were carriage H,000, Godown Rent t5,000 and Advertisement
. fJ,O 00 · »
e15 entitled t0 a commission of 5% on Sales. Find out the Value of Consignment
· Stoe k.
Ans, [Value f . l
o Closing Stock= (31,800]
"
I
J
 cd 2 00,000 units at ('5 each to Mr. Ram and paid freight and ins1.1r-,._
.
Shyam constgn • . furth Amounts· . "'lte
Amounting to ~L00,000. R a m s p e nt the following er ·
5,000
fi) Insurance
4,000
(ii) Godown Rent
6,000
(iii) a earing
. d magcd during transit due to heavy rains. Ram sold 1,00,000 units
2 , 000 u:ruts were a . . at~
per uniL Ram realized salvage value of damaged un its tZ,000. Ram is t~ get a commission lo
5 % on sales. Detennine the abnormal loss. (JCWA Foundation; December 20o9;t

Ans. [Abnormal Loss = f9 ,000)

MMUISt----------
10.000 kg of Ghee were sent at the rate oftZ.50 per kg. The Co~gnor paid t4,000 for Freight
and Insurance. 400 kg of Ghee were accidentally destroyed dunng the transit. The Con stgne,
.
Sold 8000 kg at t3.2 5 per kg and his Expenses were t900
. Godown Rent, 1,100 Advertis· eme~
Consignee reported a Loss of 100 kg due to evaporatton. From the above Information

Calculate
(a) Abnormal Loss
(b) Value of Closing Stock
Ans. f Abnormal Loss= U ,160, Value of Closing Stock ~4,396,]
[ Hint: Loss due to Evaporation in Normal Loss]

Mil#&ii,IM·i:89°:MPOiiii,!IWi+l··:·A4½!i4:lb·i·i•iiiiii,ii4+MIHiHM
MiiiWiiii/ibti#
Ram Kumar Mills Ltd., Bangalore sent 500 shirt pieces to Apoorva Stores, Mysore on
Consignment Basis. The Consignee are entitled to receive 5% Commission plus Expenses.
The Cost to Ram Kumar Mills Ltd. is t40 per piece. Apoorva stores incurred the following
Expenditure
Railway Freight etc. n,ooo
Godown Rent tSOO
1 Ram Kumar Mills drew on the Consignee a draft for t10,000 which was duly accepted. It was
!
f discounted for t9, 700. Later Apoorva Stores, Mysore report that the entire consignment has
i been sold for ?30,000.
; Prepare Consignment Account in the Books of Ram Kumar Mills Ltd.
:
€
i
d
 Consignment Accounts

- In the books of Ram Kumar Ltd.

Consignme nt A/ c Cr.
Amoun Particulars Amoun
rs
20,000 By Apoorva Stores A/c 30,000
ignment A/ c
(Sales Proceeds)
roGoO
rsoo. 40 ) 1,500
rva swresA/c
ro fipa<' miSsion) (30 ,000 " ½'oo)
I [Corn
of'\13 swres A/c
ro /lP0 . h 1,000
iunwaY Fre1g t 5illl 1,500
Godown Rent 7,000
Toprofit & Loss A/ c
(Bal. Fig.) (Profit) 30,000
m 30,000

.,u;.u;;;m•
uaryana Cycle company, Delhi sent on Consignment to Palani & Sons Chennai 100 cycles
. . d at !2 500 each on January 8, 2012. On the same date the company paid the following
mvo1ce ,
enses: (arriage t9,800, Insurance t2,000 and Sundries t3,000. On February 1, 2012 the
:panyreceived a 3 months' bill from Palani for t2,00,000. On March 1, the consignee sends an
Account Sales that the cycles have been sold at B,100 each and that he has deducted expenses
m,ooo (Carriage t2,800, Warehousing tS,000 and Sundries t4,200) and commission at 10%
on Sales.
Prepare Consignment A/c in the Books of Consignor.
(TU, 2" d Semester, BBM, May/June 2010(Modified))

ci:i;;;;.;
In the books of Haryana Cycle Company
Dr. Consignment A/ C Cr.

L Particulars Amount(t) Particulars Amountm

ITo Goods sent on Consignment A/ c 2,50,000 By Palani & Sons A/c 3,10,000
(JOO X 2,500) (100 X 3,100)
IToBankA/c
I Carnage 9,800
Insurance 2,000
I Sundries
-3.filill 14,800
ITo Palani & Sons A/c
Carriage
2,800
j
I Warehousing 5,000 1
Sund ri es l
..4.2.ill)_ 12,000

'
I
 To Palan i & Sons A/ c
tC,~m missi on) (3, 10, 000, 10 ) 3 1,000
100
To Profi t & Loss A/ c (Bal. Fig.) 2, 200
(Profi t)

11!iiiiiiiniim
&ihWHO/.bW-------~~- __::_:. .:.__:. . _- ''--------------------'~L.. ._ ,
(~) 3,10,000 (~) 31
O,ooo

J of Abmedabad consigns two Refrigerators Costing ~2.000 each to B of Surat and incurs t
as Freight, ~100 for Insurance and ~50 towards Handling Charges.Bis entitled to a co ... rn· lio
... ISs'
of 10% and_also 5 % as del-credere commission. _B spends t150 towards Godown Charges 10 11
~1 00 for Miscella neous Expenses. 'B' Sells Refrigerators for 6,250 and remits ~5000 illld
The other refrigerator was sold for ~7550 but ~1500 remained unrealised and subsequ to I.
became bad debt. enuy
Prepare Consignment A/c in the Books of J.
4;;;;;;.;
In the books of J
Dr. Consignment A/c
Cr.
Particulars Amount(~) Particulars
Amountm
To Goods sent on Consign ment A/c 4,000 By B's A/c (Sale) (6,250 + 7,550)
(2 X 2,QQQ) 13,Boo

To BankA/c
Freight 120 I

I Insurance 100
Handling Charges SQ 270
To B's A/c
Godown Charges 150
I
Miscellaneous Expenses 1!ill 250
To B'sA/ c
(Commission = 10% + 5 %)
2,070
( 6,2so + 7,sso = 13,soo x J{00)
1

To Profit & Loss A/c 7,210

(B/F) (Profit)
(~) 13,800 m 13,800
Note: Since there is a payment of del-credere commission, the bad debts should not be shown m
Consignment A/c.

iii'HIMIM414.-------
M Ltd. of Mangalore consigned 300 boxes of tt,000 each to B Ltd. o f Bangalore. They incurred
t8,000 as Freight and t2,000 as Insurance. B Ltd. is entitled to get 10% Commission on Sales.
B Ltd. took Delivery of Goods and Sold all the boxes at tt,200 per box.
B Ltd. incurred an Expenses Amount's to t 20,000.
Prepare Consignment A/c in the books of M Ltd., Mangalore.
 Consignment Accounts

- In the books of M Ltd., Mangalore

Consign ment A/ c Cr.
Amount Particulars Amount
particuJars
3,00,000 By B's Ltd. A/c (Sa le) 3,60,000
consignment A/ c
ds sent on (300 X 1,200)
r0Goo1 ooo)
(300 X ' By Profit & Loss A/c 6,000
8,000 (Loss) (Ba l. Fig.)
fo sank A/ C
Freight 2.Qill! 10,000
i insurance 20,00 0
td. A/c (E,cpenses)
ITo Bl, A/c (Commission
· )
To Bt,td· 36,000
(3,60,ooo x11/ioo}
3,66,000 (t) 3,66,000
I
911rAQ@M-
ff da Motors Ltd., sent on consignment to Prakash Agencies, Bangalore 50 Motor
ffero .onvo,·ced at t40,000 each on 5 th January 2012. On the same date the company paid the
cycles .ID expenses· Carriage t24,000, Insurance ~6,000 and Sundries ~5,000. On 5 th February
folloWtng · .
the company received a 3 months bIII for H0,00,000. On 15 th March the consignee sends
12
!~Account sales that the Motor Cycles realized ~48,000 each and that the firm has deducted
m, oo as expenses (Carriage ~6,000, Warehousing H2,000 and Sundries ~6,600) and
6
Commission 5% on Sales.
Prepare Consignment to Bangalore Account.

&.\iiii•#
In the Books of Hero Honda
Dr. Consignment to Bangalore A/c Cr
Date Particulars Amountm Date Particulars A.mount (~
5/1/2012 To Goods se nt on 20,00,000 15/3/2012 By Prakash Agencies A/ c 24,00,000
Consignment A/ c (50 X 4 8,000)
(SO x 40,000)
5/1/2012 To BankA/ c
Carriage 24,000

15/1/2012
Insurance
Sundries
6,000
.5,_Q_Q_Q 35,000
l
To Prakash Agencies A/ c
(Expenses) 24,600 f
IS/3/20 12
To Praka sh Age ncies A/c
f
(Commission)
I
I15/3/ 2012 (24,oo,ooo x Yioo}
1,2 0,000
!.
I i

'4l
To Profit & Loss A/c
(Ba l. Fig.) (Profit) 2,2 0,400

- ~) 24,00,000

i.....
(t) 24,00,000
 wMMHUiUA•
Madhukara of Mysore sent on Consignment 1,000 articles to his agent at Bangalore S .
The a,t;de> were spent at '200 pe, piece. f,eight cha<ges inru...-ed by Madhuka "l<,'11i
to '20,000-At uangalore, Karthik pa id Octorl and Carriage '5,000. KartMk sold a:o
1
¾,•..,,\
,z,30,000 and sent an account sales, deducUng the Expenses and Commission at ote,.,
Sale proceed'- p,-epare the Consignment Account in the books of Madhukara. 'on c,,
&ili•H:· - In the books of Madhukara
Consignment A/ c
Particulars
Dr. Amount~)
Particulars 2,00,000 By Karth ik A/c (Sale)
To Goods sent on Consignment A/c
(1,000 X 200) 20,000 By Stock on Consignment A/c 45,00!J
To Bank A/c (Freight Charges) (Closing Stock)
5,000
To Karthik A/c (Octori and Carriage)
To Karthik A/c (Commission)
23,000
( 2,30,000 • J{00 )
1

To Profit & Loss A/c 27,000

(Bal. Fig) (Profit) 2,75,000
Z,75,000

\forking '.\"ote

Calculation of Closing Stock

Step I: Calculation of Goods received by Consignee

Qty. Amount(f)
Particulars
1,000 2,00,000
Goods Sent on Consignment (1,000 x 200)
{ 20,000
l C+) Non-recurring Expenses of Consignor
;
I
(·) Normal Loss in Transit
I

' (·) Abnormal Loss in Transit

Goods Received by Consignee

1,000
2,20,000

•
I
I
I
(
Qty.
••I' Particulars
2,20,()()0
1,000
I Goods Received by Consignee

i ( +) Non-recurring Expenses of Consignee

s,OOo
i Octroi and Carriage
 Consignment Accounts

I LDss in Godown
(·) riorrn3 al LOSS in Godown
(·) tiboof11l 1,000 2,25,000
,1,,ble for Sale
i;oodSA'i<l""

unsold stock = Goods available for Sale - Actual Sales

= 1,000 - 800 = 200 articles
k
Goods available for Sale (in ~)
Closing StoC == ~ds available for Sale (in Qty.) x Unsold Stock

= = ~ x ZOO
1,000

Closing Stock = 45,000

uMfiHI•
Bbal"'th of Bangalore consigned 600 Chests of Tea at fl,000 per Chest to Kiran of Kolar Paying
p,-eigl>t 18,000 and other Expenses H,000. Kira• Sold 500 Chests at fl,500 per Chest. Ki ran
s,ent for freight and Octroi f 6,000 and other Expenses fl,000. He remitted the Amount o,
to sbarath after Deducting bis Commision 5%.
rrepare consignment A/ c.
Cr.
G!iii!i• Consignment A/c AmoUDtm
l

Dr. Particulars
Amount(n 12,50,000
[ Particulars
12,00,000
By Kiran A/c (Sale)
To Goods sent on
Consignment A/c (600 x 2,000)
(500 X 2,500)
Consignment A/c 2,03,000 'i
I:
Stock on
By
To BankA/c (Closing Stock)
Freight 8,000
12,000
Other Expenses woo
ToKiran A/c
6,000
' f
I
Freight &Octroi
8,000
Other Expenses llQQ
ToKiran A/c l!
62,500
(Co mmission) (12,so,000 x tioo) l
i
To Prufit &Loss A/ c
1,70,500 14,53,000 4
Hal. Pig) (Profi t] -
14,53,000
(f)
i
(f)
-
 Qty.
Goods Sent on Co nsign ment (600 x 2,000)
600 Atnount (~
( +) Non -recurring Expenses of Consignor 12.00.000
Freight
8,000
Oth er fal)enses
.4.ili!.Q
(-) Normal Loss in Transit 12,000
(-) Abn ormal Loss in Transit

;;;;;;;;;;;;;;;;;;;;;;;;;;;;;,.;;;;;;;;;;------__J__~~- _J___
Goods Received by Consignee 600
_11;2,12,000

Particulars
Qty.

I
Goods Received by Consignee
600
(+)Non-recurring Expenses of Consignee
Freight and Octroi
6,000
(-) Normal Loss in Godown
(-) Abnormal Loss in Godown
Goods Available for Sale
6 00 12,18,000

Unsold Stock = Goods available - Actual Sales

= 600 - 500 = 100

Goods available for Sale ( in t) 12 8 o

Closing Stock = -----------'------'-- x Unsold Stock - ,l ,O0 100
Goods available for Sale ( in Qty.) - 600 x

Closing Stock= 2,03,000

4MIHl/,Jli.§lt•8
Anurag Agarwal Consigned 800 Packets of Lipstics, each Packet containing 200 Lipstics. Cost
Price of each Packet was ' 600. Anurag Spent ' 100 per Packet as Cartage, Freight, Insurance and
Forwarding Commission. two Packets were lost on the way a nd Anurag lodged claim with the
Insurance Company and could get only '540 as claim on average basis. Consignee took delivery
of the rest of the packets and Spent '39,900 as other non-recurring Expenses and ·22,soo :s
Recurring Expenses. He Sold 740 Packets at the Ra te of'13 per Lipstic. He was Entitled to 4 ¾
Commission on Sales Plus 2% Del Credere Commission.
Prepare the Consignment Account a nd Consignee's Personal Account in the Books of Anurag
Agarwal.
 ...
In the books of Anurag Agarwa l
~,II
I

Consignment A/c Cr.

Amount(f) Particulars Amount(f)

4,80,000 By Consignee A/c 19,24,000

(Sale) (7 40 x 200 x 13)
Goods sentAo/: (800 " 600)
fo . nJTlent By Stock on Consignment A/c 43,500
cons1g 80,000
BOO 100)
kAIc ( )
rosan r:xvenses By Abnormal loss A/ c 1,400
(consignor
r0 cons1·gnee A/c
·ng Expenses 39,
900
62,400
Non-recuf11 zz.5_Q_Q_
Recurring r:,:pense

foconsignee A/C 6 1,15,440

. s,·on) (19,24,ooo " ½oo)
(Cornrrus 12,31,060
Toprofit & Loss A/c
(Bal. Fig) (Profit)
(<) 19,68,900
(<} 19,68,900
Ci
Consignees Personal A/c
Particulars Amount({)
Dr, 1 Amount(f)
particulars 62,400
19,24,000 By Consignment A/c
ToConsignment A/c (Sales) (Expenses)
1,1 5,440
By Consignment A/ c
(Commission)
17,46,160
By Bank A/c (Bal. Fig.)
(<) 19,24,000 I
(<) 19,24,000 I

.-
Calculation of Closi~g Sto~k and Abnormal Los~

Step I: Calculation of Goods received by .Consignee ·

Amount({)
Qty. f
4,80,000

Goods Sent on Consignment (800 x 600)

800
r1
80,000
(+] Non-recurnng
· Expenses of Consignor
Cartage, Freight & Insurance (800 x 100) 5,60,000
800 0

1,400
2
1) Abnormal Loss ( 5,60,000 x i
2) .j
,.
l soo 5,58,600
798
Lood
s Received bY_Consignee

________..a
I
 Partlrula rs Qty.

Goods Received by Consignee 798

5,58,600
li ) Non-recurring Expenses of Consignee
39,900
798
S,98,soo
(·) Normal Loss in Godown

(·) Abnormal Loss in Godown ·I

~ oods Available for Sale
798
S,9B,soo
.,:1a@w&#I
Unsold Stock = Goods available - Goods Sold
= 798 - 740 = 58

Goods available for Sale (in ~) x Unsold Stock

Closing Stock = Goods available for Sale (in Qty.)

-- ~ 798 X
58

Closing Stock= t43,SOO

4iiiliiii618
On 21• January 2012, M/S Baluja Brothers of Bombay forwarded to Akhtar of Lucknow a
consignment of 25 drums of Coconut Oil at 1510 per drum. They paid Hso for freight on 18'
March 2012. The Consignor Received an AcC<Junt Sales, On March 31, showmg that the goods
had <ealized
had been m,ooo Gross including l5,000 sold on Credit and that the following Expe,,.,
in incurred:

0-i
and Deland Insurance
Credere !100; Storage
Commission at 2%.l30; Cartage l25; Freight on Sales l95: Commission @3%

One Customer owing ! 200 failed to Pay because ofinsolvency and another customer deductol
mo because of dispute regarding quality. Akhtar sent a bill of exchange for the Balanced"
of the Consignee.
Prepare the necessary Accounts in the Books of the Consignor. Also show the Net Pro6t or t..
 In the Books of Baluja Brothers
Consignment A/c
Cr.
Amount Date Particulars Amount ?
12,750 31/3/2012 By Akhtar A/c (Sales) 15,000
ds sent on
foGoO A/c
·gnrnent
conS1
25 510)
( k A/c (Freight) 150
fo san
18/3/2012 A]dttaf A/c
To . & Insurance 100
10/3/201Z ocrro• 30
Storage 25
c;artage 250
Freight on Sales ....9..5
To Akhtar A/c
15/3/2012 cornrnission
,_3 : 450
15,000 100

Del Credere
sOOo . 3-
1• 100
:300
15.Q 900
Dispute Amount
To Profit& Loss A/c 950
14/J/2012
(Bal. Fig.) (Profit)
I

~) 15,000 (t) 15,000

No(~): In case of Del credre Commission Bad Debts should by Borne by Consignee. Hence it will not
appear in Consignment A/C.
(2) Any dispute regarding Quality should be Borne by Consignor.
Akhtar's Account Cr.
Dr.

' Date
Particulars Amount(~ Date Particulars Amount m ,!
ll/1/2012 To Consignment A/ c 15,000 31/3/2012 By Consignment A/c
(Sales) Octroi 100
Storage 30
I Cartage
Freight
31/3/2012 By Consignment A/c
Commission 450
25
.9..5. 250
I fI
f:
!
I
Del Credre 300
Dispute Amount -1.5.Q 900 j I

31/3/2012 By Bills Receivable A/c

(Bal. Fig.)
13,850
I (
t
----- 'Consi
(~) 15,000 m
g11 ee sent B111 s O f Exchange for the Balance. Hence Bal. Fig. is Bills Receivable A/c.
15,000
i
' I

,.,.I
 Goods Sent on Consignment A/c
Dr. Ct
L ~D~.are~---l--__:Pa:_r_:·
ti c::::a:_:rs:___
u1 -rArn
= ou__n-:--t~~~)t ~Da:te=1n~=:P::a:rti=cu=la:-;rs~I -
Arnount ~;
12,750 21/1/2012 By Co nsignmentA/c
31 / 3/ 2012 To Trading A/c (Bal. Fig.) 12,7 50
m 12,750 (~)
12,7 50

Commission 450

Del Credre Commission 300

750

(-) Bad Debts 200

Net Profit 550

Lubrizols Ltd., on Bombay consigned 1,000 barrels of Lubricant Oil costing ?800 per barrel to
Central Oil Company, Calcutta on 1st January 2012. Lubrizols Ltd., paid ?50,000 as freight and
insurance. 25 barrels were destroyed on January 7, 2012 in transit. The insurance claim Was
settled at HS,000 and was paid directly to consignors.
Central Oil Company took delivery of the consignment on 19 th January 2012 and accepted and
accepted a bill drawn upon them by Lubrizols Ltd., for ?5,00,000 for three months. On 31a
March 2012, Central Oil Company reported as follows:
(i} 750 barrels were sold at H,200 per barrel.
(ii} The other expenses were:
Unloading 2,500
Godown Rent 10,000
Wages 50,000
Printing etc 2..L.3..Q.(! 83,800
(iii} 25 barrels of Oil were lost due to leakage which is considered as normal loss. Central Oil
Company is entitled to a Commission of 5% on all the sales effected by them. Central Oil :
Co., paid the Amount due in respect of the consignment on 31 st March itself. Show the
Consignment Account, the Account of Central Oil Company and Abnormal Loss A/c will
appear in the books of Lubrizol Ltd.

I
 In the Books ofLubrizols Ltd ·• 8 ombay

Consignment A/c Cr.

I I 1
Amount rn
pr, _.,,,..------
?"' .. ' pardcofars m
Amount Date PartfcuJars

~ l; : ;_ s_e-.
nt~o:n- - - 1 r~8:,0:0,~
0:00j :7:/ 1~/ :,
20~1~2i B-y-A-bn- o-rm
- a-l_A_/c- - - L - ~ = - _ ]

, ,µo 12 consignment A/' 21,250

1 (1,000 " 800) 9,00,000
31/3/2012 By Central Oil Company A/c
5 0,000 (Sales) (750 x 1,200)
To sankA/ c
1/1/20 12 (Freight & Insurance) 1,75,000
31/3/2012 ByStockon
T central Oil Company A/c Consignment A/c
31/3/2012 o Unloading 2,500 (Closing Stock)
Godown Rent 10,000
Wages 50,000 83,800
Printing 2.L1ili!
31/3/2012 To centra_l o_il Co. A/c
comm1ss10n 45,000
1
I 9,00,000 )( ,¾QO
1,17,450
\ 012 To Profit & Loss A/c
41312 (Bal. Fig.) (Profit) ~J, 10,96,2501
m 10,96,250
Cr.
Central Oil Company A/c l
Amount ml
r I ParticuJars
D~
l
ParticuJars
I Amount m Date
5,00,000
By Bills Receivable A/c
Date
To Consignment A/c
9,00,000 19/1/2012 83,800
,I
31/3/2012 By Consignment A/c t
31/3/2012
(Expenses)
I
45,000
By Consignment A/c
31/3/201 2
(Commission)
I By Bank A/c (Bal. Fig.)
2,71,200 I
31/3/2012 9,00,oool
mI
ll I
I I (t) I
9,00,000 I Cr:

Abnormal Loss A/c IAJ110UDt m1

Dr. particulars 15,000
l Date I
I , Particulars Amountm By BankA/ c I
21,2 50 7/1/2012 (Insurance Claim)
' 7 1/2012 To Consignment
. A/c 6,250
i
By Profit & Loss A/c
4
31/3/2 01 2 (Bal. fig.)
~)
21,250 l I

21,25 0
I
(t)
-
 I Particulars Qty.
Arnount (~
Goods Sent on Consign m en t ( 1,0 00 x 800) 1000
a.00.000
(+J Non-recurring Expenses of Consignor
Freight & Insurance -
I 1000
a.so.ooo
(-) Nonna! Loss in Tra nsi t -

(- ) Ab no nna l Loss m
. Trans1t
. (-
8,50,00 0 25) 25

---
--x 2 1.2so
1000

__
Goods Received by Consignee
,,.
975 s,2a,1 50

-
,

• ,~
"' -
- -
Particulars Qty. Amountci)
Goods Received by Consignee 975 8,28,7So
( +) Non-recurring Expenses of Consignee
Unloading - 2.soo
975 8,31,250

(-) Normal Loss in Godown 25

(-) Abnormal Loss in Godown -
Goods Available for Sale 950 8,31,250
1

S,Mli•IINrifiiiMil.;ash4ii4¥f+I
Unsold Stock= Goods available -Actual Sales
=950 - 750 =200
Goods available for Sale (in t) Id k
Closing Stock = -----------,-~--'-,- x Unso Stoc
Goods available for Sale (in Qty.)
= 8,31,250 200
950 X

Closing Stock= 1,75,000

c;;;;;.;;;;w:-
B of Bombay consigned 400 packages of Coffee to K of Kanpur. The cost of each package was
BOO. A sum oH'2,000 was paid towards Freight and Insurance by B. In the transit, 60 packages
were damaged. However, the consignor received ~400 for the damaged packages from tbe
Insurance Company.
The Consignee accepted a Bill ofExchange for ~60,000 for 50 days as an advance to B ofBombaY·
The operating statement from the Consignee disclosed the folJowing information:
 '1111111

I
'

cJ<'8"5 ,.ere sold@ noo per package.

I
so P3
{•) fbe
2 d ,,,,ge d packages were sold@ HOO per packa
·d H 4-00 wwards Godown Rent n 000
ge.
3I>" P"' • • • ,or
ir Carria O
1rl) flle!'~s c1e•ri•8 charges, . . ge utward •nd fl,400
. e< ,,. • ntided to a comm1ss1on of 10% on the Sal e proceeds
[(Jw-1
0
""'
,.edi'eo11s gttrtll• consignment period, K of Kanpur sent a Ba nk draft to·8 re
,od1• ,.., the necessary accounts on the books of Co . ombay. You are
ftl . d,. pi<P" ns1gnor 8 ofBombav

r
rt'l 01re --- - - - - -
In the books of B of Bombay
Cr.
Consignment A/ c
Amount{t) Particulars Amount(?)

1,20,000 By K's A/c

280 X 360 1,00,800
1,06,800
ssent on 60 X 100
ro Go od A/C(400 >< 300) 18,900
con5ignrnent 2,000 By Stock on Consignment A/c
(Closing Stock)
A/ (Freight & Insurance) 12,300
rn sank/\ C By Abnormal Loss

1,400
'To ts A/C 1,000
Godown Rent 5,800 480
~rriageO/W JAill! By Profit & Loss A/c
Clearing Charges (Bal. Fig.) (Loss)
To ,,: Afc (CommisSion)
5 10,680 1,38,480
(1.06,BOO X,½oo)
1
1,38,480
Cr.
I
K'sA/c Amountm
Particulars
Or. l Amount~) T 5,800
Particulars By Consignment A/c
r 1,06,800
(Expenses)
To Consignment A/c (Sale) 10,680
I
By ConsignmentA/c
(Commission) 60,000
By Bills Receivable A/c 30,320
By BankA/c (Bal. Fig.)
rJ I 1,06,800

1,06,000 I
CtJ I Cr:

Abnormal Loss A/c I AJDounterJ

Or, Particulars 400
Particulars
Amount(t) IBy Bank A/c (Insurance Claim) 11,900
To Consignment A/c
12,300
By Profit & Loss A/c (Bal. Fig.) 12,300 I
ml
- (~) I
12,300
 Dr. Goods Sent on Consignment A/c
r::--::-- - - -Pa:
_rtkuJ
__a_rs
_ _ _ _ _+ A
_m_,.;,;_o_u_n ...:
t('""'
') _ _ _ _ _
1
P_a r_tt_c_u_la___r..:..s_ _ _ _ _ 1 A Cr
To Trading A/ c (Bal fig) 1,20,000 By Consignm ent A/c rnoullt(t) ·
1,20.000
1,20,000
1,20,000
Working Xote

Calculation or Abnormal Loss and Closing Stock

Stc•p I: C alculation of Goods rec-eh·ed by Consignee

Particulars Qty.
Amountm
Goods Sent on Consignment ( 400 x 300) 400
1.20.000
( +) Non-recurring Expenses of Consignor
Freight & Insurance
2.000
400
1.22,000
(-} Normal Loss in Transit
. Tra . ( 1,22,000 ) 60
(-) Ab norma I Loss in ns1t --:WO x 60 18,300

LG
_o_o_d_s_R
_e_ce
_ iv_e_d_b...:y_C
_o_n_s_i:::.
gn_ e_e_ _ _ _ _ _ _ _ _ _ _ _ _ _ __.___ _3_4_0_ _....1__ _~1,~03,700
Actual Abnorma l Loss= Abnormal Loss - Sale Value (60 x 100)
= 18,300 - 6,000 = 12,300

. . ...
Particulars Qty. Amount (f)
Goods Received by Consignee 340 1,03,700

( +) Non-recurring Expenses of Consignee

3,400
Clearing Charges
340 1,07,100

(·) Normal Loss in Godown

(·) Abnormal Loss in Godown
340 1,07,100
Goods Available for Sale

Unsold Stock= Goods received - Actual Sales

=340 - 280 =60 Pa ckages
. St k 1,07,100 x 6 0
=-Good
- -s available for Sale (in~) d k
I

\ Closmg oc - -- ----,-'--~ x Un sol Stoc

340
Goods available for Sa le ( in Qty.)
'I
I Closing Stock = 18,900
l
 II I

l
e consigned 1,500 Batteries costing ~5 000 each to Manju
aanga I O r . , '
. s Ltd-, b Consignor paid ?75,000 towards Freight Charges and Insura nce
er•e IT e .
IJ3~ f&1ulbaga·tit
,t11cD 5 o I"
·. was ,,'ound that 10. Batteries. were damaged and Insurance Company
1
,.,, Aical ·pg cra11s Man ju Electricals received the Balanced Consigned Goods and
0t"'oOO· 0 daiJJl for HS,O 00goo.
1111 . They accepte d a b'III
d rawn ,or
' <2 0,00,000 as Advance. Manju
110, .he es H 4 ,
_111ed IJ' d- gCb 3 rg . s for cash at <6,5 00 and 450 batteries on Credit at t 7,000 each.
,pr IOa I0 aattene
id VII sold soO Godown Rent, t6,500 for Advertisement and <30,000 as Salesman
5
~ectl1cal t t42,ooO for ·t1ed to get an Ordinary Commission at 5% on Sales and Del credere
111 er sve: consignee ~:dit Sales. Man ju Electricals remit the Balance due to the Consignor
1arY· f1'. at 2% on
sa JIii·5510"
e,olll ,. oraft A/ (b) consignee A/ c, ( c) Abnormal Loss A/ c
pan" . rnent c,
bY (a) consign (BU, B.Com. znd Sem. May/June 2012)

-
prepare,

In the books of Amco Batteries Ltd.

Consignment A/c Cr.
Amount(f) Particulars Amount(fj
pr.
part1cutars
75,00,000 By Manju Electricals A/c
(Sales) Cash
T Goodsse nton
I oConsignment A/ c (800 X 6,500) : 52,00,000
(J,500 X 5,000) Credit (450 x 7,000) = 3150000 83,50,000
By Abnormal Loss A/c 50,700
To BankA/c 75,000
Freight Charges 3J10._Q_Q 1,05,000
Insurance 12,19,200
By Stock on Consignment A/ c
To Man juElectricals A/ c
Unloading Charges 14,900

I
Godown Rent 42,000
Advertisement 6,500
Salesman Salary .3JLll.ill)_ 93,400
To Man juElectricals A/ c
Ordinary Commission 4,17,500
(83,50,000 x 7ioo)
I
I .,
Del Credre Commission !i3.QO.O.
f
(11.50,000, fioo) !
4,80,500
To Profit & Loss A/ c
(Bal Fig.) (Profi t)

--
14,41,000 l
(?) 96,19,900 m 96,19,900

i.
•
.
•
Q
 Dr.
Manju Electricals A/c
Particulars Amount{f) Particulars
To Consignment A/c (Sales)
83,50,000 By Consignment A/c
(Expenses)

By Consignment A/c
(Commission)
4.ao.sool
By Bills Receivable A/c
(Bills Drawn)
20,00.000'
I
By BankA/c (Bal. Fig.)

m 83,50,000
57,76,100

(~
83,so.ooo
Dr.
Abnormal Loss A/c
Particulars Amount(f) Cr.
Particulars
To ConsignmentA/c Aniollllt«)
50,700
By BankA/c (Insurance Claim)
45,ooo
By Profit & Loss A/c (Bal. Fig.)
5,700
50,700
\forking Xote 50,700

tall'ulat ion of Abnormal Loss and Closing Stock

Stt>p I: Calculation of Goods received by Consi

Particulars
Qty.
Goods Sent on Consignment (1,500 x 5,000) Amountm

(+} Non-recurring Expenses of Consignor 1500 75,00,000

Freight
Insurance 75,000
30.000 - 1,05,000
(-) Normal Loss in Transit 1500 76,05,000
-
-
(-) Abnormal Loss in Transit ( ~ )
1,500 X]O

Goods Received by Consignee 10 50,700

1490
-
75,54,300
 11

Consignment Accounts

.(.1JC U
I:l
.
t 1011 0
,.,,om
fC,oo

II . Particulars Qty.
ftCI' Amount(t)
1490 75,54,300
·¢1 bY eonsignee
-:: _,.As jlece• . t:,cpenses of Consignee
r.,ov-- recUrring 14,900
(~) ontoading
tJof1• · Ch~es
1490 75,69,200

! I [,OSS in Godown
. r.Jor111 3
{) I Loss in Godown
3 1490 75,69,200
AbllorJT1
(·) ·table for Sale
1
G00 dsA~
s1eP JJI: (:iJrulation of Closing Stock
stock = Goods available - Actual Sales
unso Id = 1,490 - (800 + 450) = 240
Goods availabl_e for Sale (int)
l sing Stock == - ( ) x Unsold Stock
C0 Goods available for Sale in Qty.

== 75,69,200 X 240
1490
Closing Stock= 12,19,200

v;kraDl Milk Foods company Ltd., of Vikrampur, sent to Sunder Stores, Sonepuri 5,000 kgs of
Baby food, packed In 2,000 tins of net weight ofl kg and 6,000 packets of net weight of½ kg
for sale on consignment basis. The consignee's commission was fixed at 5% of Sale Proceeds.
The Cost Price and Selling Price of .the Product were as under
1 kg tin ½ kg tin I
I
Cost Price HO t6
Selling Price t 15 t7
l
I
The_consignment was booked on 'Freight to Pay ' basis and Freight Charges came to 2% of l
selli~ value. One case containing 50, 1 kg tins was lost in transit and the Transport Carrier 1 t
admitted a claim of t450. At the end of the first half year the following information is gathered
. the Account Sales sent by the Consignee.
from
(1) Sale Proceeds 1,500 1kg tins
I
"} 4,000 1/2 kg. tins ! I
!
Sh(11 StoreRent and Insurance Charges t600
v,i~
th
tbe ~onsignment Account Consignee's Account and Abnormal Loss A/c in e books of
.
'

· the Amount d ue fro m

1\1.tOl Milk Food Company Ltd.,' assuming that the consignees bad patd
thou,.
l

i
 - . m Milk f oods co. Ltd,
In the bookS of Vitera
Cr.
Consignment A/ c
A Dr,
AIJ\OUDt(f)
Particulars Amount(l)

----
=
particulars
By Sunder Stores A~c (Sales) 22 500
G ds sent on Consignment A/ c l kg 1,500 x 15 - '
To 1 ; 2,000 x l O= 56,000
½ kg 4,000 x 7 == .2.8..00.0. so,soo
½ kg 6,000 x 6 =
By Stock on Consignment A/c
To Sunder Stores A/c 1 kg Tin 4,635
1,440 1/2kgTin .12.2fil1 16,915
Freight 2,040
Rent & Insurance 6illl
By Abnormal Loss A/c sis
To Sunder Stores A/ c (Commission)
(so.soox½oo) 2,525

To Profit & Loss A/c 7,365

(Bal. Fig.) (Profit)
(fl
m 67,930 67,930

Note: Freignt Charges on Sale Value

2,000 x 15 30,000
6,QQQ X 7 42,000

n.ooo x ½oo = 1,440

Dr. Sunder Stores A/c (Consignee A/c) Cr.

Particulars Amountm Particulars Amount{f)

I 50,500 By Consignment A/ c (Expenses)

To Consignment A/c (Sales) 2,040
By Consignment A/ c
(Commission) 2,525

I
I Dr.
(t) 50,500
By BankA/c (Bal. Fig.)

(fl
45,935

50,500

Abnormal Loss A/ C Cr.

Particulars Amount(~)
• Particulars Amount(f)
i To Consignment A/c
51 5 By Bank A/c (I nsurance) 450

l
I - (t) 515
By Profit & Loss A/c (Bal. Fig.)

• (f)
65

515
i
 1KgTln ½ Kg Tin

Qty. Amount Cf) Qty, Amount(f)

2000 20,000 6000 36,000

·gnrnent
conSI
sent on s of Consignor
f,cpense
Goods .
.recUrring 30,000 x½oo 600 840
½
==
11 15
[t) N° l J{g 2,000 "
I freight " 7 == 42,000 x 100
¼ J{g 6, 000 2000 20,600 6000 36,840

in Transit
orrnal 1,oss
(·) N ( 20,600 xSO1
so 515
\ I Loss in Transit l2,000 ) 36,840
. Abnorrna 1950 20,085 6000

1 Kg Tin ½ Kg Tin

Particulars Qty. Amount m Qty. Amountm

1950 20,085 6000 36,840

Goods Received by Consignee
(+) Non-recurring Expenses

(·)Normal Loss in Godown

(·)Abnormal Loss in Godown
20,085 6000 36,840
1950
Goods Available for Sale

umlllllllMll·lllm:mT[F • I I
I,
Unsold Stock = Goods available - Actual Sales

1 kg tin = 1,950 -1,500 = 450

½ kg tin = 6,000 - 4,000 = 2,000
Closing Stock = Goods available for Sale ( in t) x Unsold Stock
I
Goods available for Sale (in Qty.)
i
1K r· 20,085
g In = l,950 X 450 = 4,635
l
½ Kg Tin 36,840
= 6,Q00 X 2,000 = 12,280