Accountancy · Ch 2 — Consignment Accounts
A Brief Note on Accounting in the Books of the Consignee
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A Brief Note on Accounting in the Books of the Consignee
The consignee is only an agent, never an owner, so his books never show the value of the goods he receives at all — no entry is passed merely on receipt of goods on consignment, exactly because ownership has not changed. His books record only the transactions that actually affect him personally:
| Transaction | Journal entry in the consignee's books |
|---|---|
| Expenses paid by the consignee on the consignor's behalf | Consignor's A/c ... Dr / To Bank A/c |
| Goods sold on the consignor's behalf | Bank/Debtors A/c ... Dr / To Consignor's A/c |
| Commission earned (ordinary, del credere, over-riding) | Consignor's A/c ... Dr / To Commission A/c |
| Balance remitted to the consignor in final settlement | Consignor's A/c ... Dr / To Bank A/c |
Definition 1Consignor's Personal Account (in the consignee's books)
A personal account maintained by the consignee recording only the expenses he pays, the sales he makes, the commission he earns, and the balance he remits — never the …