Final Assonants
Lecture # 05
Journal Entries relating to Trading Account
The preparation of the Trading Account requires that the balances of all such
accounts, which are due to appear in the Trading Account, are transferred to it. The journal
entries required for such transfer are termed as closing entries. These will be as follows:
1. Closing entry for the accounts transferred to the debit of Trading Account
Trading Account Dr
To Opening Stock Account
To Purchases Account
To Direct Expenses Account
To Carriage Account
To Gas. Fuel and Power Account
To Freight. Octroi and Cartage Account
To Custom Duties Account
To Royalty Account etc.
2. For Purchases Returns, the entry is:
Purchases Returns Account Dr
To Purchases Account
3. For Sales Returns, the journal entry is:
Sales Account Dr
To Sales Returns Account
1
Lecture # 05
Journal Entries relating to Trading Account
The preparation of the Trading Account requires that the balances of all such
accounts, which are due to appear in the Trading Account, are transferred to it. The journal
entries required for such transfer are termed as closing entries. These will be as follows:
1. Closing entry for the accounts transferred to the debit of Trading Account
Trading Account Dr
To Opening Stock Account
To Purchases Account
To Direct Expenses Account
To Carriage Account
To Gas. Fuel and Power Account
To Freight. Octroi and Cartage Account
To Custom Duties Account
To Royalty Account etc.
2. For Purchases Returns, the entry is:
Purchases Returns Account Dr
To Purchases Account
3. For Sales Returns, the journal entry is:
Sales Account Dr
To Sales Returns Account
1
