Declaration authentication by responsible persons for (VAT Return 9.1)

Corporate practice bd

Damage of goods  Journal Entry- With Practical Examples:

A Damage Journal Entry is used to record the loss of goods due to damage. This type of entry helps in accurately reflecting the reduction in inventory and recognizing the loss in financial statements. The entry typically involves writing off the cost of damaged goods from the inventory account and recognizing the loss in an expense account.

Practical Example

Let's assume XYZ Corporation discovered that 100 units of their product were damaged. The cost per unit of the damaged goods was $9.00.

Journal Entry for the Damage:

1. Date: May 21, 2024
2. Description: Damage of goods
3. Quantity: 100 units
4. Unit Cost: $9.00 per unit
5. Total Amount: $900.00

Corporate -Accounting Treatment:

Journal Entry:

• Debit: Loss Due to Damage $900.00
• Credit: Inventory $900.00

--------------------------------------------------------------------------------Date         Account                     Debit           Credit          
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 2024-05-21 

  Loss Due to Damage          $900.00                      
              Inventory                                         $900.00         

   (100 units at $9 each damaged)                             
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