Question

To record unsold stock with Consignee, which of the following entry will be passed in the books of Consignor?

• A. $\begin{array}{c}\text{Consignment Stock A / c}Dr.\\ \text{To Consignment A / c}\end{array}$
• B. $\begin{array}{c}\text{Consignment Stock A / c}Dr.\\ \text{To Goods sent to Consignment A / c}\end{array}$
• C. $\begin{array}{c}\text{Goods sent to Consignment A / c}Dr.\\ \text{To Consignment Stock A / c}\end{array}$
• D. $\begin{array}{c}\text{Consignment Stock A / c}Dr.\\ \text{To Stock Reserve A / c}\end{array}$

Answer 1

The correct option is A $\begin{array}{c}\text{Consignment Stock A / c}Dr.\\ \text{To Consignment A / c}\end{array}$

The consignee sells the goods sent on consignment on behalf of the consignor. When the stock remains unsold with the consignee at the end of a period, it will be recorded by the consignor in his books as Consignment stock. So, the entry passed will be:

Consignment stock A/c. Dr.

To Consignment A/c