Are inventory gains and losses included in administrative expenses or non operating income?

Gains, losses or damages to inventory should be accounted for as gains or losses on property to be disposed of. After being approved according to the management authority, it will be dealt with separately according to the reasons for profit and loss.

Profit: 1. Before approval.

Borrow: raw materials and other accounts.

Credit: Pending property loss and overflow.

2. After approval.

Borrow: Loss or overflow of property to be disposed of.

Credit: Administrative expenses.

Inventory loss: 1. Before approval.

Borrow: Loss or overflow of property to be disposed of.

Credit: raw materials.

Tax Payable – VAT payable (input tax transferred out).

2. After approval.

It is a normal loss, a general loss caused by mismanagement, and a net loss after deducting other accounts.

Borrow: Administrative expenses.

Credit: Pending Property Gains and Losses.

The part that is indemnified by the responsible person and the insurance company.

Debit: Other receivables.

Credit: Pending Property Gains and Losses.

It is an extraordinary loss caused by natural disasters and force majeure factors.

Borrow: Non-operating expenses — extraordinary losses.

Credit: Pending property loss and overflow.

There is a situation where the residual material is put into storage.

Borrow: raw materials.

Credit: Pending property loss and overflow.

When an enterprise has an inventory surplus, it debits the accounts of "raw materials" and "inventory goods", and records the "profit and loss of property to be disposed of", and after reporting to the approval according to the management authority, the "profit and loss of property to be disposed of" is debited, and the account of "management expenses" is debited.

When an enterprise incurs an inventory loss, the "profit or loss of property to be disposed of" is debited, and the goods are recorded in the accounts of "raw materials" and "inventory goods". After reporting for approval according to the management authority: for the value of the remaining material in the warehouse, it is credited to the "raw material"; For the compensation that should be paid by the insurance company and the negligent person, it shall be recorded in "other receivables"; After deducting the value of the residual material and the net loss that should be borne by the insurance company and the negligent party, the part that belongs to the general operating loss is recorded as "management expenses", and the part that is an extraordinary loss is recorded as "non-operating expenses".

The new standard stipulates that the current assets of the profit.

Management costs for the current period should be written off.

Borrow: Raw Materials, Commodities in Stock, Cash in Stock.

Credit: Administrative Expenses - Inventory Surplus.

Why is the inventory surplus not included in non-operating income?

In accordance with the Accounting Standards for Business Enterprises.

provisions, inventory earnings offset administrative expenses. Prior to the revision of the new accounting standards, inventory gains were included in non-operating income. The main considerations for the change to offset management costs are:

Inventory is a necessary asset required for production and operation, and it will not be profitable for no reason, but it is due to the savings in production and the strengthening of management, but it is not directly related to production, so it will be written off from management expenses rather than production costs. Since the profit generated in the measurement is not a real profit, it is necessary to adjust the account books of the party with the error.

Due to the change of the new accounting standards, the inventory surplus is no longer included in the non-operating income, and it is written off in accordance with the relevant regulations to reduce the management expenses of the draft, and the reasons are explained in detail above.

The surplus of inventory shall be recorded in accounts such as raw materials, and the loss and excess of property to be disposed of.

property damage and overflow to be disposed of, management expenses, etc.; The inventory loss shall be recorded in the accounts of property loss and surplus to be disposed of, raw materials and other accounts, property loss and excess to be disposed of, and tax payable and VAT payable.

The details are as follows.

One. Inventory surplus.

1.Pre-Approval:

Borrow: raw materials and other accounts.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

The inventory of the surplus is usually caused by the error in the measurement or calculation of the daily receipt and dispatch of the enterprise, and the inventory of the surplus can be offset against the management expenses, and the accounting entries are as follows:

2.After approval:

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Administrative expenses.

Two. Inventory loss.

For the inventory loss, the enterprise prepares the following accounting entries according to the "inventory inventory report".

1.Pre-Approval:

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Raw materials and other accounts.

The value-added tax payable for the inventory loss caused by abnormal losses (theft, loss, mildew and deterioration caused by mismanagement) of purchased goods and products in progress shall be transferred to the account of "property loss and excess to be disposed of".

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Tax Payable VAT Payable (Input VAT Transferred Out.)

For abnormal losses caused by non-human factors, the input tax amount does not need to be transferred out.

2.After approval:

Borrow: administrative expenses (receipt, measurement, mismanagement), non-operating expenses.

extraordinary net loss), other receivables.

Receivable from the responsible person, the insurance company).

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

The inventory gain is a prior-period error, but the inventory profit is usually small and does not affect the financial statements.

The user's view of the company's financial position, results of operations and cash flow in previous years.

Therefore, when the inventory is profitable, the "property loss and excess to be disposed of" account is accounted for, and the "management expenses" are written off after the approval of the management authority, and the statements of previous years are not adjusted.

The inventory profit shall be recorded in raw materials and other accounts, property losses and surpluses to be disposed of, property losses and surpluses to be disposed of, management expenses, etc.; The inventory loss shall be credited to the accounts of property loss and excess to be disposed of, raw materials and other accounts, property loss and excess to be disposed of, tax payable and VAT payable.

The details are as follows.

One. Inventory surplus.

1.Pre-Approval:

Borrow: raw materials and other accounts.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

The inventory of the surplus is usually caused by the error in the measurement or calculation of the daily receipt and dispatch of the enterprise, and the inventory of the surplus can be offset against the management expenses, and the accounting entries are as follows:

2.After approval:

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Administrative expenses.

Two. Inventory loss.

For the inventory loss, the enterprise prepares the following accounting entries according to the "inventory inventory report".

1.Pre-Approval:

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Raw materials and other accounts.

The value-added tax payable for the inventory loss caused by abnormal losses (theft, loss, mildew and deterioration caused by mismanagement) of purchased goods and products in progress shall be transferred to the account of "property loss and excess to be disposed of".

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Tax Payable VAT Payable (Input VAT Transferred Out.)

For abnormal losses caused by non-human factors, the input VAT that should be borne by the inventory loss inventory does not need to be transferred out.

2.After approval:

Borrow: administrative expenses (receipts and disceiving, mismanagement), non-operating expenses (extraordinary net loss), other receivables (receivables, insurance company compensation).

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

The inventory profit is an error in the previous period, but the inventory profit is usually small and will not affect the judgment of the financial statement user on the financial status, operating results and cash flow of the enterprise in previous years.

The surplus of inventory should be recorded in raw materials and other accounts; Inventory losses should be recorded in the accounts of property losses and surpluses to be disposed of, raw materials, etc.

(1) Inventory surplusBefore Approval:The enterprise shall deal with the surplus inventory as follows according to the amount listed in the "Inventory Inventory Report".

Borrow: raw materials, inventory goods, etc.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

After the report is approved:The inventory of the profit is usually caused by the error in the measurement or calculation of the daily receipt and dispatch of the enterprise, and the inventory of the inventory of the inventory is handled as follows after being approved according to the regulations

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Administrative expenses.

(2) Inventory lossBefore Approval:1) For the inventory loss, the enterprise shall be treated as follows according to the amount listed in the "Inventory Inventory Report":

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: raw materials, inventory goods, etc.

After the report is approved:For the inventory loss, it should be dealt with according to the reasons for the loss

1) It belongs to the loss within the quota and the error in the measurement of the daily receipt and dispatch of inventory, after the approval of the report

Borrow: Administrative expenses.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

2) Losses that should be compensated by the negligent party, and the accounting treatment is as follows:

Debit: Other receivables.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

3) Inventory losses that occur due to irresistible reasons such as natural disasters shall be treated as follows:

Borrow: Non-operating expenses — extraordinary losses.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

Inventory surplus.

Borrow: raw materials, etc.

Credit: Pending property loss and overflow.

Borrow: Loss or overflow of property to be disposed of.

Credit: Administrative expenses.

Inventory loss.

Borrow: Loss or overflow of property to be disposed of.

Credit: raw materials.

Tax Payable – VAT payable (input tax transferred out).

Borrow: raw materials.

Other receivables, etc.

Credit: Pending property loss and overflow.

What accounts are recorded and inventory losses recorded into?

Inventory Profit: The inventory profit is included in the raw material account

Before the approval of the report: the enterprise shall deal with the surplus inventory according to the amount listed in the "Inventory Inventory Report" as follows: borrow: raw materials, inventory commodities, etc.: loss and excess of property to be disposed of - loss and excess of current assets to be disposed of.

After the approval: the inventory of the inventory is usually caused by the error in the measurement or calculation of the daily receipt and dispatch of the enterprise, and the inventory of the inventory of the inventory shall be treated as follows after the approval is reported according to the regulations: borrow: loss and excess of property to be disposed of - loss and excess of current assets to be disposed of: management expenses.

Profit of fixed assets: The profit of fixed assets shall be treated as an error in the previous period, and shall be accounted for through the account of "profit and loss adjustment of previous years" before being approved for processing according to the management authority. The accounting entries are as follows:

Borrow: Fixed Assets Credit: Prior Year Profit and Loss Adjustment, Borrow:

Prior Year Profit and Loss Adjustment Credit: Surplus Reserve, Profit Distribution - Undistributed Profit.

The CPA exam chapter knowledge points are summarized, and I wish you easy evidence collection.

Mobile question bank.

PC Question Bank.

1. The inventory profit is offset by the management expenses.

The accounting entries are as follows:

Borrow: raw materials.

Turnover materials. Inventory items, etc.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Administrative expenses.

2. The inventory loss of inventory is handled differently according to different reasons.

The accounting entries are as follows:

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: raw materials.

Turnover materials. Inventory items, etc.

a.The value-added tax payable for the inventory loss caused by abnormal losses (theft, loss, mildew and deterioration caused by mismanagement) of purchased goods and products in progress shall be transferred to the account of "property loss and excess to be disposed of".

Borrow: Excess of property to be disposed of - Excess of current assets to be disposed of.

Credit: Tax Payable VAT Payable (Input Tax Transferred Out) bThe inventory of inventory loss should be transferred according to the reasons for the inventory loss, which belongs to the loss within the quota and the error in the measurement of daily receipt and dispatch of inventory, and is transferred to management expenses after approval.

Borrow: Administrative expenses.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

For losses that should be compensated by the person at fault, the following entries should be made:

Debit: Other receivables.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

c.For inventory losses due to force majeure reasons such as natural disasters, the following entries should be made:

Borrow: Non-operating expenses — extraordinary losses.

Credit: Excess of Property to be Processed - Excess of current assets to be disposed of.

Summary. The inventory profit is generally caused by errors in the measurement or calculation of sending and receiving, which can be offset against management expenses; However, there are many cases of inventory loss, which are explained below: 1

According to the amount listed in the "Inventory Inventory Report", the inventory profit of the inventory enterprise in the property inventory shall prepare the following accounting entries: borrow: the inventory profit of raw materials, turnover materials, inventory, commodities, etc. is generally caused by errors in the measurement or calculation of receipts and dispatches, and the management expenses can be deducted; However, there are many cases of inventory loss, which are explained below

1.The inventory of the inventory of the enterprise in the property inventory, according to the amount listed in the "inventory inventory report", the preparation of accounting entries as follows: debit:

Raw materials, turnover, materials, inventory, commodities, etc.

Isn't inventory gain included in non-operating income, and why is it sometimes written off for administrative expenses?

The surplus of inventory is generally caused by errors in the measurement or calculation of sending and receiving, and the argument can offset the management costs; However, there are many cases of inventory loss, which are explained below: 1The inventory of the inventory of the enterprise in the property inventory of the inventory, according to the amount listed in the "inventory report", the preparation of accounting entries as follows:

Borrow: The surplus of raw materials, turnover, materials, inventory, commodities and other inventories is generally caused by errors in the measurement or calculation of sending and receiving, which can be offset by management expenses; However, there are many cases of inventory loss, which are explained below: 1

According to the amount of trousers listed in the "Inventory Inventory Report", the accounting entries are prepared as follows: borrow: raw materials, turnover materials, inventory commodities, etc.

The inventory surplus of an enterprise is usually caused by errors in the measurement or calculation of the company's daily sending and receiving, so the management fee should be offset.

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