Inventory adjustment of scrap parts

USA Discussion in 'General Accountancy Discussion' started by roxanna9, Nov 16, 2018.

  1. roxanna9

    roxanna9

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    Hi,

    I work with sage 50. I have received a list of scrap parts that have been already adjusted in inventory. Besides those adjustments, do I have to post an entry journal for the value of the loss? If it is so, the journal would be: debit "scrap/inventory adjustments ( expense account) and credit : _____? inventory?

    I will appreciate your help, thank you
     
    roxanna9, Nov 16, 2018
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  2. roxanna9

    Dada Olayemi

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    I think if there is a scrap, and it has been sold...what you have to do is to calculate gain or loss on disposal...by deducting from the sales price the carrying amount as at the date of sale....the profit or loss will be credited(if a gain) or debited(if a loss) then credit inventory with the carrying amount of the asset sold....then finally debit cash/bank for cash received .

    But if it is writing down value of inventory, Dr p or l with the reduced amount, then credit the inventory to reduce the value of the inventory.
     
    Dada Olayemi, Nov 24, 2018
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    Jasmine2018 likes this.
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