If the stock has never been on Sage before, then there will be nothing in 5202 (although there should be a figure there after the year-end adjustment journals were put on your Sage, but that's another issue).
The journal which you want to do now, is DR '1040', CR '5203'. This will bring the stock in as an Asset on the Balance Sheet, and remove it from the Cost of Sales on the P&L.
When you are given new stock figures, you should do the same journal, but only for the movements in the new figures from the last set.
e.g. stock 30/11/10 = £1000, 31/12/10 = £3000
30/11/10 DR '1040' £1000, CR '5203' £1000 31/12/10 DR '1040' £2000, CR '5203' £2000
this will leave you with stock of £3k on the B/S, and closing stock of £3k in the P&L
only thing is they don't want any assests for this company incase it goes under, all the real assests e.g. furniture, appliances are in the name of the company they own which owns the building.
Nicola if they don't want any assets recorded then don't put any journals in, they may want monthly stocktakes doing just for internal matters, eg to make sure nobody is stealing. Then the accountant can journal in the last stock take at year end. However if they want management accounts doing monthly then the journals need posting. In any case it's one thing telling your creditors that you do not own any machines, cars furniture but quite another to get them to believe you carry zero wet stock in a bar!
only thing is they don't want any assests for this company incase it goes under, all the real assests e.g. furniture, appliances are in the name of the company they own which owns the building.
That sounds like a bit of an issue to me! I take it you are bookkeeping the individual bars, which are separate entities to a Holding Company?
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As Phil states, that puts things in a whole different light.
If there are issues over the going concern of the business which you seem to indicate, then how dependable are the stock counts?
Are all three carried out at the same time? do the bars know exactly when and in what sequence the counts are to occur?
If there is a risk of stock being moved between sites then the stock take may be counting basically the same stock at different sites on different days.
This would normally occur to hide actual sales not being put through the books (so add VAT fraud to the scenario).
Keep your eye on the client and bear in mind that they may be doing a bit of window dressing here.
Good luck,
Shaun.
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Shaun
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ok, i am back with this one, have finally pinned the directors down.
Regarding Assets, there is a journal they want at the end of the financial year to transfer it to the balance sheet. All they are wanting me to do is to show it as the cost of sales
They want this to show on the monthly P&Ls but everytime i think i have got the journal down for it leaves me with a stock balance of £50 or a massive stock or a massive stock deficit
I am guessing it could be something to do with not having any opening stock journal, and trying to put it all on the same journal?
My opening stock figure for the year was £4557.48 Would i show this with a Journal entry to suspense on the last day of the previous financial year? e.g DR o/s 4557.48 CR suspense 4557.48
Closing Stock will depend on whether it's greater or lower than Opening stock, assuming it's higher
Dr Stock a/c (bs) - 1001 Cr Cost of Sales (Pl) - 5201 *
Naturally, the Credit for the opening stock should be "swallowed" up in the opening balance sheet i.e. a mixture of creditors/ bank etc. But as you seemingly don't have the rest of the opening TB I'd let the accountant sort it out.
hth.
Also, I'd like to ask - what's wrong the separate legal entity owing the building and the fixed assets and recharging the Limited companies (bars) a usage fee. I'm not saying it's ok to do it but I'd appreciate some background info.
-- Edited by ADAS on Tuesday 15th of February 2011 02:17:36 PM
-- Edited by ADAS on Tuesday 15th of February 2011 04:03:29 PM
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