Question

Goods lost by fire is debited to Goods A/c.

• A. True
• B. False

Answer 1

The correct option is B False

Goods lost by fire is a loss to the organization and to be debited to profit & loss account. Goods are moving out from the business. Hence, they need to be credited.

Accounting entry will be as under:

Profit & Loss A/c Dr.

To Goods A/c