CONSIGNMENT ACCOUNT

Financial Accounting SSS2 Third Term

WEEK – TEN

CONSIGNMENT ACCOUNT

CONTENT

TOPIC: CONSIGNMENT ACCOUNT

CONTENT

1. Definition 
2. Accounting Entries     
3. Practical illustration

Note

Consignment of good means the sending of goods by a supplier to his agent to receive, store and sell them on behalf of the supplier after which the proceeds, having deducted all expenses incurred, will be remitted to supplier. The sender of the goods is called consignor while the agent to whom the goods are sent is called consignee.

ACCOUNTING ENTRIES

In the Books of the consignor, you will open 

(a)     Consignment account

i.       Debits all expenses relating to goods consigned

ii.      Credits all revenue relating to goods consigned

(b) Goods sent on consignment…