View Full Version : What is the abnormal loss in the consigment a/c credit side?
riddhiparekh925
Feb 9, 2011, 04:07 AM
On 1st October 2007, B of Bombay consigned to A of Ahemdabad 100 mobile sets . Cost of each was Rs 1900.B incurred expense of Rs.5000 on goods consigned. On 31st December 2007 A informed B that he had sold 68sets @ 2800 and 11sets @ 2700. He also spent Rs. 15200 on Behalf of consignor . One set has accidentally damaged and sold for Rs.500 according to the instruction of consignor. A was entitled commission of6% on gross sales including del credere commission.
rehmanvohra
Feb 9, 2011, 11:50 PM
Abnormal loss occurs when the loss occurs due to abnormal circumstances beyond the control of either the consignor or the consignee. In this case the loss of one set due to damage is an abnormal loss. You need to calculate the cost of the set which is the invoice value plus proportionate charges incurred by the consignor and the consignee. The amount of loss will be the cost as determined above reduced by the sales price recovered from sale of the damaged unit.