Closing Stock of Raw Cotton in Balance Sheet Items:
Closing Stock of Raw Cotton represents the value of raw cotton that remains unsold or unused at the end of an accounting period. This stock is an essential part of a company's inventory and is reported under the Current Assets section of the balance sheet.
Reporting Closing Stock of Raw Cotton on the Balance Sheet:
The closing stock of raw cotton is included in the inventory section, providing a clear picture of the raw materials available for future production. It is critical for accurately reflecting the company's assets and is essential for inventory management, financial planning, and analysis.
Calculation of Closing Stock of Raw Cotton
Amount (TK)
Opening Stock of Raw cotton ****
Add: Purchase (LC Wise)(Indian. Brazilian) ****
Less: Issue (SR) (WIP) (****)
Closing Stock of raw cotton ****
Raw cotton Purchase -Journal Entry
Debit Credit
LC (Wise) LC-12022401010260 ****
Transit R/C -LC-1202240101260 ****
Narration:
Amount payable to Louis Dreyfus Company India PVT. Ltd against purchase of Indian Raw Cotton - MCU-5-R0014-120224010260 (194760.620000KG) @253.744500; MRR No: ARML-MRR-24-0456, MRR Date: 25/03/2024, SPR No: ARML-SPR-24-0046, SPR Date: 08-02-2024
Landing cost Booking Journal
Debit Credit
Transit R/C -LC-120224010260
LTR-231-63856 RC-LC-101560 SIBL ****
(Creation dt.26.03.20)
LC CHARGE & COMMISSION ****
INSURANCE PREMIUM (PRIME INSURANCE) ****
CARRYING BILL (AULIA TRANSPORT AGENCY) ****
CLEARING BILL (EVA ENTERPRISE) (C& F) ****
BANK CHARGE ****
LC AMENDMENT CHARGE ****
LOADING & UN LOADING CHARGE ****
RELATED PAYMENT A/C HEAD ****
Narration:
(Landing cost related expenses are booked)
Issue Journal Entry:
Debit Credit
Work in Process (WIP) ****
LC-120224010205 *****
Narration:
Production department received LC: 120224010128, Indian Raw Cotton - MCU-5 (6500.000000Kg) Issue No: ABC-ISS (RC)-24-0350, Issue Date: 01/05/2024
Conclusion:
The closing stock of raw cotton is a vital component of a company's inventory, reflecting the value of raw materials available for future production. Proper accounting and management of this stock are crucial for accurate financial reporting, effective cost management, and efficient production planning. By accurately valuing and managing the closing stock of raw cotton, a company can improve its financial health and operational efficiency.