This document discusses double-entry accounting for inventory transactions. It provides examples of journal entries for purchasing inventory for cash and on credit, selling inventory for cash, and selling inventory on credit. For each transaction there is a debit and credit to accounts like stock control, cash, creditors control, debtors control, cost of sales, and GST clearing.

1. 9.5
DOUBLE-ENTRY FOR
INVENTORY

2. © Michael Allison, Trinity Grammar School. Author’s permission required for external use
General Ledger
Source
Document
 Covered in earlier topics. To refresh…
9.5 DOUBLE-ENTRY FOR INVENTORY
Journal
Bought goods for cash
$700 (plus $70 GST)
Cash Payments
Journal
Cheque Butt
Bought goods on credit
for $600 (plus $60 GST)
Purchases
Journal
Purchase
Invoice
DEBITS CREDITS
Stock Control
700
GST Clearing
70
Cash
770
Stock Control
600
GST Clearing
60
Creditors Control
660

3. © Michael Allison, Trinity Grammar School. Author’s permission required for external use
 Covered in earlier topics. To refresh…
General LedgerSource
Document
Journal
Sold goods costing $300
for $500 plus $50 GST
for cash
Cash Receipts
Journal
Receipt
DEBITS CREDITS
Cash
550
Cash Sales
500
GST Clearing
50
Cost of Sales
300
Stock Control
300
9.5 DOUBLE-ENTRY FOR INVENTORY

4. © Michael Allison, Trinity Grammar School. Author’s permission required for external use
 Covered in earlier topics. To refresh…
Source
Document
Journal
Sold goods costing
$400 for $900 plus
$90 GST to a
customer on credit
Sales
Journal
Sales Invoice
General Ledger
DEBITS CREDITS
Debtors Control
990
Credit Sales
900
GST Clearing
90
Cost of Sales
400
Stock Control
400
9.5 DOUBLE-ENTRY FOR INVENTORY