Ledger Accounts | Reliable Papers

Calcutta Ayurvedic Ltd. produces a bottle of “Draksharista” at a cost of ~ 10. They appointed Madras Medical Stores of Madras as their agent on the terms that the agent would get commission @ 10% on invoice price of goods sold and also an extra commission at 25% on any excess amount realised over invoice price. On 1.7.2014, Calcutta Ayurvedic Ltd. sent 50 boxes of “Draksharista” each box containing 50 bottles at invoice price showing a profit of 331/3% on such invoice price. They spent ~ 3,000 for freight and ~ 2,000 for insurance. 5 boxes were completely destroyed in transit and insurance claim of ~ 2,300 was realised from the insurance company. The agent took delivery of the remaining goods and spent ~ 2,000 for duty and ~ 1,000 for freight to carry the goods to the rented godown. He also sent a Bill of Exchange for ~ 20,000 payable after 2 months to the consignor as advance. At the end of the year, the agent reported that 40 boxes were sold at ~ 18 per bottle and 1 box of goods was lost due to bad packaging. This would be treated as normal loss. The agent remitted a bank draft for the net amount after deducting his commission, advance money, godown rent ~ 800 and selling expense ~ 200. On 1.1.2015, Calcutta Ayurvedic Ltd. discounted the bill of ~ 20,000 for ~ 19,800. On 1.3.2015, bank informed that the bill was dishonoured. Calcutta Ayurvedic Ltd. demanded the entire amount along with an additional amount of ~ 200 as interest. The Madras agent sent a bank draft for the amount on 15.3.2015 You are asked to show the following Ledger Accounts in the books of the consignor : (a) Consignment to Madras Account; (b)Madras Medical Stores Account; (c) Consignment Stock Account; (d) Consignment Stock Destroyed Account; (e)Consignment Stock Reserve Account.

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