INSTITUE OF COMMERCE, NIRMA UNIVERSITY

B.COM(HONOURS)PROGRAMME

SEMESTER-2 BATCH 2020-23.

Individual assignment
Topic – consignment
SUBMITTED TO : PROF. GOPIKA JUNEJA

SUBMITTED ON : 20th APRIL 2021.

SUBMITTED BY : LAVISHA GOYAL

ROLL NO. : IC201248

 ACKNOWLEDGEMENT
The success and final outcome of this assignment required a lot of guidance and assistance

from many people and Iam extremely fortunate to have got this all along the completion of

this assignment. I express my sincere thanks to Prof. Gopika Juneja to encourage us to the

highest peak and to provide us the opportunity to prepare the project. All the valuable

guidance and kind supervision given to me throughout the course helped to shape the

present work as it shows. Whatever I have done is only due to elevating inspiration and kind

supervision given by our guiding faculty.

I would like to express my gratitude to our friends and respondents for support and

willingness in finalizing this project within the limited time frame. Lastly, we would like to

express our gratitude towards Prof. Udai Paliwal for providing us the online infrastructure to

learn and connect with our faculty virtually.

Question:
Ahaan ltd. of Mumbai which deals in raw mangoes , consigned 10,000 dozen of
raw mangoes to Rysa ltd. of Delhi which priced Rs.300 per dozen on May 1st,
2021. For this, Ahaan ltd. paid Rs. 5,00,000 for freight, packaging and insurance.
During voyage, 500 dozen of raw mangoes get destroyed due to heat which is
treated as normal loss and 750 dozen of raw mangoes were loss due to
carelessness which is treated as abnormal loss. For which , 70% amount is
compensated by the insurance company, which is directly paid to consignor.

On May 14th, Rysa ltd. took the delivery of the remaining consignment and paid
Rs. 50,000 for octroi duty. Also , other expenses incurred by Rysa ltd. was Rs.
3,50,000 for salesman’s salaries. On same day, Rysa ltd. sent a bank draft of Rs.
10,00,000 to Ahaan ltd. as an advance and Ahaan ltd. discounted it at 9,50,000.

Later, sent an account sales showing that 6500 dozen of raw mangoes had been
sold at following prices:

3000 dozens @400per dozen, (credit sales)

3500 dozens @ 500 per dozen

Rysa ltd. is entitled to get 7% normal commission on total sales, 2% commission

on surplus of sale price over invoice price and 3% del-credere commission on
credit sales. There was a debtor who bought 100 dozens @ 350 rs was unable to
pay and become bad debts.

You are required to record necessary journal enteries and ledger accounts in the
books of consignor.
 Journal entries

In the books of ahaan ltd.

Date Particulars L.F. Debit Credit
consignment A/c 30,00,000
Dr. 30,00,000
To goods sent on consignment A/C
(goods sent on consignment to consignee)
Consignment A/c Dr. 5,00,000
To cash A/c 5,00,000
(expenses incurred by the consignor)

Abnormal loss A/c Dr. 2,62,500

To consignment A/c 2,62,500
(abnormal loss of 750 dozens of raw mangoes )

Insurance company A/c Dr. 1,83,750

Profit & loss A/c Dr. 78,750
To abnormal loss A/c 2,62,500
(insurance claim )

Bank A/c Dr. 1,83,750

To insurance company A/c 1,83,750
(insurance claim admitted)

B/R A/c Dr. 10,00,000

To Rysa ltd. A/c 10,00,000
(B/R received from Rysa ltd.)

Bank a/c Dr. 9,50,000

Consignment a/c Dr. 50,000
To B/R a/c
(B/R discounted from bank) 10,00,000
Consignment a/c Dr. 3,50,000
To Rysa ltd. a/c 3,50,000
(expenses incurred by Rysa ltd.)
 Rysa ltd. a/c Dr. 29,50,000
To consignment a/c 29,50,000
(amount of goods sold)

Consignment a/c Dr. 2,62,500

To Rysa ltd. a/c 2,62,500
(commission to Rysa ltd.)

Unsold stock a/c Dr. 8,77,500

To consignment a/c 8,77,500
(unsold stock transferred to consignment a/c)

P&L a/c Dr. 73,000

To consignment a/c 73,000
(loss transferred )

Cash a/c Dr. 13,37,500

To Rysa ltd. 13,37,500
(balance amount on consignment)

Goods sent on consignment a/c Dr. 30,00,000

To trading a/c 30,00,000
(Goods sent on Consignment transferred to Trading A/c)

Ledger in the books of ahaan ltd.

Consignment a/c
Date Particular Amount Date Particular Amount
To goods sent on consignment 30,00,000 By abnormal loss a/c 2,62,000
a/c
To cash a/c 5,00,000 By Rysa ltd. a/c 29,50,000
To B/R a/c 50,000 By unsold stock a/c 8,77,500
To Rysa ltd. a/c (commission) 2,62,500 By P&L a/c 73,000
To Rysa ltd. a/c (expenses) 3,50,000

41,62,500 41,62,500
 Rysa ltd. a/c (consignee a/c )

Date Particular Amount Date Particular Amount

To consignment a/c 29,50,000 By B/R a/c 10,00,000
By consignment a/c 3,50,000
By consignment a/c 2,62,500
By cash (final payment) 13,37,500

29,50,00 29,50,000
0

Goods sent on consignment a/c

Date Particular Amount Date Particular Amount

To trading a/c 30,00,000 By consignment a/c 30,00,000
30,00,000 30,00,000

Unsold stock a/c

Date Particular Amount Date Particular Amount

To consignment a/c 8,77,500 By balance c/d 8,77,500
8,77,500 8,77,500

Abnormal loss a/c

Date Particular Amount Date Particular Amount

To consignment a/c 2,62,500 By insurance claim a/c 1,83,750
By P&L a/c 78,750
2,62,500 2,62,500

Working notes :
1. Normal loss :
500 dozens @ 300 = Rs. 1,50,000
2. Abnormal loss :
750 donzens @ 300 = 2,25,000
Add -proportionate expenses by consignor = 37,500
Total abnormal loss = 2,62,500
Less- amount claimed = 1,83,750
Net loss = 78,750

3. Unsold stock :
(10,000-500 -750- 6500) @ 300 = 6,75000
Add - proportionate exp by consignor = 1,12,500
Add – proportionate exp by consignee = 90,000
Total value of unsold stock = 8,77,500

4. Commission :
Normal commission (7%) = 2,06,500
Surplus commission (2%) = 17,000
Del- credere commission (3%) = 36,000
Total = 2,59,500

THANK YOU