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Effect of Expense Included in Valuation in Profit and Loss
Jignesh Greycube edited this page Mar 20, 2021
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1 revision
"Expense Included in Valuation" should be handled so that expense are not booked twice
a) Via addition in FG Valuation Rate (Cost of Goods Sold)
and
b)via direct Expenses booked against Bank/Cash.
Hence there are 2 options
- The Actual Expenses (labour, electricity , rent etc) can be bifurcated instead of "Expense Included in Valuation" in the Manufacture Stock Entry
or
- "Expense Included in Valuation" is a liability account which gets Credited in Step 1 if not bifurcated ,hence at the end of the year/ month
Account | Dr | Cr |
---|---|---|
Expense Included in Valuation | 2000 | |
Electricity | 1000 | |
Rent | 500 | |
Labour | 500 |