Hello Friends,

Placed below is a query relating to accounting treatment of Goods not received by us till last day of Financial Year:

A company, say X Ltd. (situated in New Delhi), gave advance for sending certain goods with a company, say Y Ltd. (situated in Chennai), on 29th March 2012 on the condition that remaining payment will be made after receiving of goods. Y Ltd. despatched goods on 31st March 2012 but they were received in New Delhi only on 4th April 2012. Now we are preparing Balance Sheet as on 31st March 2012 for X Ltd. What should be the accounting treatment of this situation in X Ltd.'s books?

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the goods in transit treatment depend on the condition of selling contract.if the property of the goods is transferred only after receiving the goods to purchaser then it will not be shown in the stock of x ltd bt it will be shown as stock in transit in y ltd 's balance sheet bt if property of the goods is vested in x ltd according to the selling contract then it ll be shown in its balance sheet as stock in transit