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The normal or usual b ala nce of Creditors Control Ledger Account or Accounts Payab le Control Ledger Account is Credit. However, there are some reaso ns, suc h as overpayme nts to suppliers, creditors or vendors, wrong amounts entered, etc., due to w hich de b it b ala nce takes place. All Creditors Sub sidiary Ledgers or Accounts Payable Subsidiary Ledger Accounts are prepared separately to avoid detailed of information in one single creditors control ledger account. T he sum of all of the i ndividuals suppliers are summed up in one creditors control ledger account. Example: Suppose a company has purchased goods from 5 suppliers. The sum of closi ng b ala nces of eac h creditors su b ledgers give a fi nal deb it b ala nce. T he n in t hat case, Creditors Co ntrol Ledger Account s hows de b it b ala nce w h ic h is s how n in t he Balance Sheet with the accou nt’s name “Advances To Suppliers” as a Current Asset .     ...

I nventory or Stock or Merc ha ndise are goods remain unsold at t he e nd of t he accou nting period w hile Office Supplies are co nsumab le items remai n on ha nd or existed in t he b usi ness for use during t he accou nting period. I nventory is related to goods purc hased b y the b usi ness for resale purposes w hile office supplies purchased b y the compa ny to use or consume in t he b usi ness and not for resale purposes.

Office Supplies or Office Supplies On Hand is eit h er purc h ased b y th e b usi ness w h ic h is available for use in t h e business or remained on h and in b usi ness at t h e end of t h e accounting period. Office Supplies Expense account is used or consumed in t he b usi ness for t he period while Cost of Sales or Cost of Goods Sold is the cost of goods or products a nd it is incurred to make Sales . Office supplies on h and is a Current Asset as it is used in t he b usi ness for t he pro b a b le b e nefits of t he b usi ness during t he curre nt accounting period w hile cost of sales is the direct cost i ncurred for t h ose goods purc hased b y the b usi ness for resale purposes. It is recorded in Income Statement or Trading Account in order to calculate Gross Profit or Gross Loss for t he accou nting period.

I n a b usi ness office, Office Supplies O n Hand / Office Supplies Unused are needed w hich are co nsumab le items such as pri nter, pencil, pen, ink port, paper, telep h ones, etc., Wit hout these supplies, a b usi ness can not b e fu nctional effectively. T he word “Supplies O n Ha nd” means t hat office supplies is availa b le for use i n t he b usi ness w he n t he b usi ness initially purc hased it or that it is still not used at t he e nd of t he accou nting period. W h en office supplies on h and is purc h ased, t h en it is existed or availab le for use i n t h e b usi ness and its b e nefit will b e get by t h e business in future. During t he accou nting period, all supplies are not consumed or used b ut remai ned to b e used i n t he next accounting period. T hese remai ning supplies are called closi n g supplies o n ha nd and t hose supplies which are used or co nsumed during t he period are called supplies expe nse b ecause the b usi n...

Carried Dow n Bala nce, w hich is writte n as Bala nce c/d s hows either the De b it Bala nce or Credit Bala nce depending upon higher sides i.e., if the amou nts of de b it side is more t ha n credit side i n a Ledger Account , t he n it s hows de b it b ala nce and if t he amou nts of credit side is more tha n t he de b it side i n a ledger account, t he n it s hows credit b ala nce as deb it side needs more amount to b ecome equal to credit side. Bala nce Carried Down of Different Types of Accounts will b e co ntinued to be tra nsferred to t he next Step of Accounting Cycle unless t he the accou nting cycle completes. For example, Office Equipme nt is a Fixed Asset , w hich has normal deb it b ala nce as its deb it side is more tha n credit side. So, t h e b ala nce carried down or b ala nce c/d is written on credit side as s how n b elow:                           ...

Promotional Expenses are t hose Expe nses w hich are i ncurred b y the compa nies to promote b usi ness’ products or services t hrough various marketi ng met hods or marketi ng tec h niques suc h as advertisements, b a nners, billboards, etc. Examples of promotion expenses are giving free products samples like free samples of furniture whe n lau nc hes new ones , offering one mont h su b scriptio n, offering free training for 3 days, offer free trial for 30 days, t h en to purch ase t h e program or software etc. T he jour nal entry to record promotional expenses is s how n b elow:                               Promotio nal Expenses a/c  XXX                                                                     ...

W h at If In A Trial B alance, Sundry Debtors And Sundry Creditors B alances Are Shown On B oth Deb it A nd Credit Column, T h en What Will B e Its Effect In Balance S h eet? In order to know t he a nswer of t his questio n we must know t he followi ng important points ab out b oth Su ndry Deb tors / Accou nts Receivab le a nd Sundry Creditor / Accounts Payable . Sundry Deb tor or Accou nts Receivab le is a Curre nt Asset w hich have favora b le de b it b ala nce. However, there are some reaso ns due to w hich it has N egative Credit Balance suc h as receivi ng advance payments from customers, wrong information entered, etc. On t he other ha nd, Sundry Creditors have favora b le credit b ala nce, so it is a Current Liab ility . b ut it has N egative or Unfavorable Debit Balance due to some reasons suc h more amou nt paid to suppliers / vendors t ha n t he actual amou nt, wrong information related to purc hase order e ntered, etc. Accounting ...

Understanding the difference between Subscription Received in Advance and Subscription Paid in Advance is essential for students, accountants, and business owners. Although both involve advance payments, they represent completely different accounting treatments because one is an income received before earning it , while the other is an expense paid before consuming the related service . This article explains both concepts with simple definitions, accounting treatment, examples, and key differences. What Is Subscription Received in Advance? Subscription Received in Advance , also known as Unearned Subscription or Advance Subscription , is the amount received from customers or members before the organization provides the related goods or services. Since the business has not yet earned this income, it cannot recognize it as revenue immediately. Instead, it is treated as a current liability because the organization still has an obligation to provide the promised services in th...