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Send consignee age

hello friends welcome back to let's to accountant Z so our today's session will be about consignment accounting but let us first see the basic concept of consignment so what this consignment so first of all will understand what is the meaning of consignment so for example if there are two person say mr. A to B for example mr. ACS and Mumbai mr. a wants to sell his books to Delhi and mr. B stays in Delhi and it does not have any branch or office in Delhi so what mr. a can do he can appoint mr. B as an agent agent for the woods so what I will do I will send the goods to B we will sell those goods on behalf of a so this sale will be on behalf of mr. a now in this case whatever remittance B will receive that remittance will be given to a and against which we will receive Commission from a so if you see the entire scenario it is there is one person who appoints another person is an agent to sell his goods and it can be in the CER same place in other bucket or it can be in other state or other country so when one person appoints another person as an agent that other person sell goods on behalf of that first person against which that person receives Communion fork it over here whatever's sale proceeds which is received by B is directly limited to a in this case now B is an agent so evil befall s principle so you see this is principal agent relationship okay and the person who can signs the words will be known as consignor and the person to whom the would second sign will be known as consigning so these are two basic people basic terms when this consignor and other is cons i me the goods which are dispatched for which are transferred to consign ii is known as consignment so when we say consignment is given guns I meant sent so that is good sent to be sold on the upper consignor on a commission basis Commission which is given to consign II so guys you understood the sense of how the working happens now in this case when the remittance is given by B to a so in that case remittance would be sale proceeds [Music] let's we will deduct all the expenses which are incurred to sell those goods because these goods belongs to a so all the selling expenses relating to this sales it can be advertisement it can be godown rent or it can be carriage charges or loading/unloading charges so all those selling expenses will be reimbursed by a so we will recover those expenses from me also we will deduct his commission from the sale proceeds so it won't happen that first we will give the entire amount then a will reimburse the amount it would be like when we is giving the remittance we will deduct all the expenses which is an in cut to make the sale we will deduct the Commission call so if any advance is given when the goods are sent by a to be at the time if B has given any advance so that will also be deducted and balance would be remitted to it so that would be the remittances any profit or loss on consignment will belong to mr. e that is consignor because these entire sin of goods is on behalf of consignor so if there is any profit or loss on this sale this profit or loss will belong to who consignor so what consigning gets from entire this transaction consigning gets commission and all profit or losses will be borne by all right the profit will go to consignor so these are the important points which you have to remember also the goods which are sent or if there is any unsold stock with consign e it is still the property of but it belongs to consignor so this is also one of the important points that you have to note that when the goods are sent to B it is not sold to B it is just transferred to B when we actually see the goods that time it is called as the goods also so when the goods are transferred when there are some Goods lying with consign e which is not yet sold at the year-end or any period and that good still belongs to the consignor so it is still the property of the consignor lying with the consent so it is physically with consigning but the ownership still remains with the consignor so these are the important points for this understanding so did you understand this concept of consignment how it works 1 percent 10 Goods to another person and then of us and seen another person gets Commission for selling those Goods so this is a consignment or trading or consignment of Counting so that's it French I hope that you understood what is consignment and its process in next session we will be learning basic terms of consignment so stay tuned with us and don't forget to press the bell like to never miss an update from us thank you you