Question

Which of the following accounts is not opened under Joint Venture accounts?

• A. Stock Reserve A/c
• B. Joint Bank A/c
• C. Other Co-venturer's A/c
• D. Joint Venture A/c

Answer 1

Answer: (A)

Stock Reserve A/c

Stock reserve account is prepared by the consignor in consignment sales when the goods sent on consignment are invoiced at a price above the cost and such goods remain unsold with the consignee at the end of a period. So, the stock reserve account records the loading on closing stock remaining unsold with the consignee. In the case of joint venture, such a situation does not arise, and hence, stock reserve account is not required to be prepared.