Year End Stock Balance

Accounting
1

I’m not sure how/where to enter the Year End Stock Take Balance.
Advice would be appreciated.
Many thanks
Margaret.

2

Hi mesholmes1956,
First of all I am not an accountant and you should always ask your accountant for things like this. But in my understanding as an general rule I would say: After the end of your trading period, the opening stock must be transferred over to the Trading Account (within the Profit and Loss Account) where it is shown as the opening stock and it will be added to purchases to increase the cost of goods sold. The double entries required for this are:

Debit Opening Stock Trading Account (nominal code 5200)
Credit Stock Account (nominal code 1001)

Once you have transferred the opening stock over to the Trading Account this means that the account which records the value of the asset of stock (nominal code 1001) now has a nil balance.

The closing stock valuation must now be recorded in the Stock Account (nominal code 1001) to record the value of the asset at the end of the trading period.
And a double entry must be made in the Trading Account (within the Profit and Loss Account) in order to reduce the cost of goods sold by the amount of the closing stock.
This requires the following book-keeping entries:
Debit Stock Account (nominal code 1001)
Credit Closing Stock Trading Account (nominal code 5201)

I hope it helps a bit but as I said before you should ask your/an accountant

3

Hi there, many thanks for the response, it’s much appreciated.
I will check with my accountant, it’s just that she always wants to do the transaction for me, and then charges me, even when I query a transaction that she’s done and isn’t right, she charges me for the correction, very annoying!! Looking to change this very soon.
Hence my question, sorry for the rant !!!
Have a great day.
Kindest regards
Margaret.

4

Hi @mesholmes1956

We do actually have a guide on opening/closing stock balances in the knowledge base which may be of some help: Journalling opening and closing stock totals

5

Hi Mathew
Many thanks, I’ll take a look.
Thanks for getting back to me.
Kindest regards
Margaret.

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