Skip to content

CMA Intermediate · Cost Accounting · Integrated Accounting System

In an integrated accounting system, when goods costing ₹3,60,000 are sold on credit for ₹4,50,000, which pair of entries is passed?

Debit Debtors and credit Sales at ₹4,50,000, and separately debit Cost of Sales and credit Finished Goods Control at ₹3,60,000. Revenue is booked at selling price while inventory is relieved at cost, so the difference of ₹90,000 appears as profit.

  1. ADebit Debtors ₹4,50,000, Credit Sales ₹4,50,000; Debit Cost of Sales ₹3,60,000, Credit Finished Goods Control ₹3,60,000Correct
  2. BDebit Debtors ₹3,60,000, Credit Sales ₹3,60,000; Debit Cost of Sales ₹4,50,000, Credit Finished Goods Control ₹4,50,000
  3. CDebit Debtors ₹4,50,000, Credit Finished Goods Control ₹4,50,000 only
  4. DDebit Debtors ₹4,50,000, Credit Sales ₹4,50,000; Debit Finished Goods Control ₹3,60,000, Credit Cost of Sales ₹3,60,000

Explanation

Sales are recorded at selling price in Debtors and Sales, while stock is relieved at cost through Cost of Sales and Finished Goods Control. Option 2 swaps the bases, and option 4 reverses the cost entry.

Did you get it right without looking?

One question tells you little. A timed set on Integrated Accounting System shows your real accuracy, how long you take and where you lose marks.

Practise Integrated Accounting SystemFree diagnostic mock

More Integrated Accounting System questions