Quote:
Originally Posted by mhz99
Kinza The value of stock withdrawn is to be
Credited to the "Trading a/c"
It is generally shown as a deduction from purchases on the debit side of the "Trading a/"
Deducted from Capital on the liabilities side of the balance sheet (as additional drawings)
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Sorry for late reply, I was busy with my state bank test.
Although the adjusting entry for Stock or goods taken by owner is "drawing a/c debit and trading a/c credit" yet we deduct the stock from purchases, this is the rule I read in both M.Arif's and Ghani's book.
Quote:
Originally Posted by mhz99
Discount allowed and discount received will come in profit&loss or trading account
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This question confuses me too and I read thoroughly the theory of M. Arif's book for this. In M.Arif's book only the terms " Discount on Purchases" and "discount on Sales" are treated as trading a/c items i.e. deducted from purchases and sales respectively and all other terms like discount allowed, discount received or discount are treated as profit and loss a/c items so i treated discount allowed and discount received as profit and loss item.