UMANG PATEL
Jul 10, 2009, 05:21 PM
Hi please help me
I have opening stock-25000 and closing stock-30000. So I want to know what is a right words we used for difference of -5000, between the opening and closing stock.
morgaine300
Jul 10, 2009, 08:28 PM
It's just the difference between two balances and isn't called anything. If you were doing a perpetual method, amounts would be going in and out of that account all the time, and the 5000 difference would just be the net of all those amounts. If you were doing a periodic method, that difference, combined with a purchases (and related) account would create cost of goods sold. But the 5000 by itself still really isn't anything.
That number is all part of a lot of other stuff that has happened and combines together to create other numbers. It isn't even how much less (or more) you sold compared to what you purchased, because there's different dollar values involved. It just isn't called anything -- it's the difference between the two balances.