Q.On 1st January 2021, Ravi of Hyderabad consigned goods valued Rs. 60,000 to Karan of Karimnagar. Ravi paid cartage and other expenditures Rs. 4,000. On 31st March 2021, Karan sent an account sales with the following information:
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🔒 Start your 14-day free trial to unlock the full solution →Concept understanding — Consignment Account and Related Ledger Accounts in the Consignor's Books
The consignor records a consignment through three linked accounts: the Consignment Account (debited with cost of goods and every expense/commission, credited with sales, closing stock, and any abnormal loss removed, its balance being the profit or loss on that consignment), the Consignee's Personal Account (debited with sales made on the consignor's behalf, credited with the consignee's expenses, commission, and the amount finally remitted), and the Goods Sent on Consignment Account (credited on despatch and finally transferred to the Trading Account so consigned goods are no …
In Ravi's (consignor's) books: the Consignment to Karimnagar Account is debited with goods sent Rs. 60,000, Ravi's expenses Rs. 4,000, Karan's expenses Rs. 3,000 and commission Rs. 3,000 (6% of 50,000), and credited with sales Rs. 50,000 and closing stock Rs. 32,000, giving a profit of Rs. 12,000. Karan's Account shows sales Rs. 50,000 less expenses 3,000 and commission 3,000, so he remits a draft of Rs. 44,000. This is a TS Inter 2nd-year (Telangana Intermediate) Accountancy consignment problem; the TS treatment aligns with the NCERT/CBSE commerce curriculum. ## Working — Valuation of unsold stock 50% of the goods remain unsold. Stock is valued at proportionate cost plus the consignor's (non-recurring) expenses: - Cost portion = 50% of Rs. 60,000 = Rs. 30,000 - Add proportionate consignor's cartage/expenses = 50% of Rs. 4,000 = Rs. 2,000 - Closing stock on consignment = Rs. 32,000 Karan's expenses of Rs. 3,000 are treated as selling/recurring expenses (incurred after the goods reached him), so they are NOT added to the value of unsold stock. ## Consignment to Karimnagar Account | Particulars | Amount (Rs.) | Particulars | Amount (Rs.) | |---|---|---|---| | To Goods Sent on Consignment A/c | 60,000 | By Karan's A/c (Sales) | 50,000 | | To Bank A/c (Ravi's expenses) | 4,000 | By Stock on Consignment A/c (c/d) | 32,000 | | To Karan's A/c (expenses) | 3,000 | | | | To Karan's A/c (commission 6% of 50,000) | 3,000 | | | | To Profit transferred to P&L A/c | 12,000 | | | | Total | 82,000 | Total | 82,000 | ## Karan's Account (Consignee) | Particulars | Amount (Rs.) | Particulars | Amount (Rs.) | |---|---|---|---| | To Consignment A/c (Sales) | 50,000 | By Consignment A/c (expenses) | 3,000 | | | | By Consignment A/c (commission) | 3,000 | | | | By Bank A/c (draft — balance due) | 44,000 | | …
In Ravi's (consignor's) books: the Consignment to Karimnagar Account is debited with goods sent Rs. 60,000, Ravi's expenses Rs. 4,000, Karan's expenses Rs. 3,000 and commission Rs. 3,000 (6% of 50,000), and credited with sales Rs. 50,000 and closing stock Rs. 32,000, giving a profit of Rs. 12,000. Karan's Account shows sales Rs. 50,000 less expenses 3,000 and commission 3,000, so he remits a draft of Rs. 44,000.
This is a TS Inter 2nd-year (Telangana Intermediate) Accountancy consignment problem; the TS treatment aligns with the NCERT/CBSE commerce curriculum.
Working — Valuation of unsold stock
50% of the goods remain unsold. Stock is valued at proportionate cost plus the consignor's (non-recurring) expenses:
- Cost portion = 50% of Rs. 60,000 = Rs. 30,000
- Add proportionate consignor's cartage/expenses = 50% of Rs. 4,000 = Rs. 2,000
- Closing stock on consignment = Rs. 32,000
Karan's expenses of Rs. 3,000 are treated as selling/recurring expenses (incurred after the goods reached him), so they are NOT added to the value of unsold stock.
Consignment to Karimnagar Account
| Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
|---|---|---|---|
| To Goods Sent on Consignment A/c | 60,000 | By Karan's A/c (Sales) | 50,000 |
| To Bank A/c (Ravi's expenses) | 4,000 | By Stock on Consignment A/c (c/d) | 32,000 |
| To Karan's A/c (expenses) | 3,000 | ||
| To Karan's A/c (commission 6% of 50,000) | 3,000 | ||
| To Profit transferred to P&L A/c | 12,000 | ||
| Total | 82,000 | Total | 82,000 |
Karan's Account (Consignee)
| Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
|---|---|---|---| …
- CBSE 2026Set ANNUAL10 marksQ.On 1-1-2020 Balaji of Hyderabad consigned goods valued at Rs. 50,000 to Shivaji of Sholapur. Balaji paid cartage and other expenses of Rs. 2,400. On 31-3-2020 sent the account sales with the following information - a. 3/4th of the goods sold for Rs. 48,000 b. Shivaji incurred expenses amounting to Rs. 1,200. c. Shivaji is entitled to receive commission @ 5% on sales. Bank draft was enclosed for the balance. Prepare necessary ledger accounts in the books of Balaji.
›Reveal solutionSolution
Goods cost Rs. 50,000; 3/4 sold for Rs. 48,000, leaving 1/4 unsold. Closing stock = 1/4 of (50,000 cost + 2,400 consignor's expenses) = Rs. 13,100. Charges are consignor's expenses Rs. 2,400, consignee's expenses Rs. 1,200 and commission Rs. 2,400 (5% of 48,000). Consignment profit = Rs. 5,100; Shivaji remits the balance Rs. 44,400 by bank draft.
Working note - valuation of closing stock
Unsold goods = 1/4 of the consignment. Only the consignor's non-recurring expenses (cartage, Rs. 2,400) are added to the cost for stock valuation; the consignee's Rs. 1,200 is treated as selling expense.
Closing stock = 1/4 x (50,000 + 2,400) = 1/4 x 52,400 = Rs. 13,100.
Consignment to Sholapur Account (books of Balaji)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods sent on consignment 50,000 By Shivaji (Sales) 48,000 To Bank (consignor's expenses) 2,400 By Consignment Stock c/d 13,100 To Shivaji (consignee's expenses) 1,200 To Shivaji (commission 5% of 48,000) 2,400 To Profit transferred to P and L A/c 5,100 61,100 61,100 Shivaji Account (consignee's personal account)
| Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
|---|---|---|---| …
- CBSE 2024Set ANNUAL10 marksQ.Bhaskar of Rajahmundry consign 500 radio sets each at Rs. 600 to Prasad of Tenali on consignment. Bhaskar paid Rs. 12,000 as freight and insurance in transit. Bhaskar drawn a bill on Prasad for 3 months for Rs. 1,00,000. Prasad send account sales which shows the following particulars: Gross sales are Rs. 4,50,000; Unloading and godown rent Rs. 10,000; Commission 5% on Gross Sales. Prasad send a Bank draft for the balance due to Bhaskar. You are required to prepare necessary Ledger accounts in the Books of consignor.
›Reveal solutionSolution
Goods sent = 500 x Rs. 600 = Rs. 3,00,000. The Consignment Account is debited with goods Rs. 3,00,000, freight/insurance Rs. 12,000, consignee's expenses Rs. 10,000 and commission Rs. 22,500, and credited with sales Rs. 4,50,000 - giving a profit of Rs. 1,05,500. Prasad settles by a bill of Rs. 1,00,000 already accepted and a bank draft of Rs. 3,17,500.
Working notes:
- Value of goods consigned = 500 sets x Rs. 600 = Rs. 3,00,000.
- Commission = 5% of gross sales Rs. 4,50,000 = Rs. 22,500.
- Bank draft (balance due) = Sales 4,50,000 - Bill 1,00,000 - Expenses 10,000 - Commission 22,500 = Rs. 3,17,500.
Consignment to Prasad Account
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods Sent on Consignment A/c 3,00,000 By Prasad A/c (Gross Sales) 4,50,000 To Bank A/c (freight and insurance) 12,000 To Prasad A/c (unloading and godown rent) 10,000 To Prasad A/c (commission 5% of 4,50,000) 22,500 To Profit transferred to Profit and Loss A/c 1,05,500 Total 4,50,000 Total 4,50,000 Prasad's Account (Consignee)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Consignment A/c (Gross Sales) 4,50,000 By Bills Receivable A/c (bill accepted) 1,00,000 By Consignment A/c (unloading and godown rent) 10,000 - CBSE 2023Set ANNUAL10 marksQ.On 1st January 2021, Ravi of Hyderabad consigned goods valued Rs. 60,000 to Karan of Karimnagar. Ravi paid cartage and other expenditures Rs. 4,000. On 31st March 2021, Karan sent an account sales with the following information:(a) 50% of the goods sold for Rs. 50,000.(b) Karan incurred expenses Rs. 3,000.(c) Karan is entitled to commission @ 6% on sales. A bank draft was enclosed for the balance due. Prepare the necessary Ledger Accounts in the books of Ravi.
›Reveal solutionSolution
In Ravi's (consignor's) books: the Consignment to Karimnagar Account is debited with goods sent Rs. 60,000, Ravi's expenses Rs. 4,000, Karan's expenses Rs. 3,000 and commission Rs. 3,000 (6% of 50,000), and credited with sales Rs. 50,000 and closing stock Rs. 32,000, giving a profit of Rs. 12,000. Karan's Account shows sales Rs. 50,000 less expenses 3,000 and commission 3,000, so he remits a draft of Rs. 44,000.
This is a TS Inter 2nd-year (Telangana Intermediate) Accountancy consignment problem; the TS treatment aligns with the NCERT/CBSE commerce curriculum.
Working — Valuation of unsold stock
50% of the goods remain unsold. Stock is valued at proportionate cost plus the consignor's (non-recurring) expenses:
- Cost portion = 50% of Rs. 60,000 = Rs. 30,000
- Add proportionate consignor's cartage/expenses = 50% of Rs. 4,000 = Rs. 2,000
- Closing stock on consignment = Rs. 32,000
Karan's expenses of Rs. 3,000 are treated as selling/recurring expenses (incurred after the goods reached him), so they are NOT added to the value of unsold stock.
Consignment to Karimnagar Account
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods Sent on Consignment A/c 60,000 By Karan's A/c (Sales) 50,000 To Bank A/c (Ravi's expenses) 4,000 By Stock on Consignment A/c (c/d) 32,000 To Karan's A/c (expenses) 3,000 To Karan's A/c (commission 6% of 50,000) 3,000 To Profit transferred to P&L A/c 12,000 Total 82,000 Total 82,000 Karan's Account (Consignee)
| Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
|---|---|---|---| …
- CBSE 2022Set ANNUAL10 marksQ.Arjun of Kamareddy and Vittal of Karimnagar are in the consignment business. Vittal sent goods to Arjun Rs. 20,000. Vittal paid freight Rs. 800 and insurance Rs. 700. Arjun met sales expenses Rs. 750. Arjun sold the entire stock for Rs. 30,000 and he is entitled to a commission of 5% on sales. Prepare necessary ledger accounts in the books of Vittal.
›Reveal solutionSolution
In the consignor's (Vittal's) books, the Consignment Account is debited with cost of goods Rs. 20,000, consignor's expenses Rs. 1,500, consignee's expenses Rs. 750 and commission Rs. 1,500, and credited with sales Rs. 30,000 - giving a consignment profit of Rs. 6,250. Arjun owes and remits Rs. 27,750.
Working note - commission: 5% on sales of Rs. 30,000 = Rs. 1,500.
Consignment to Arjun Account
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods Sent on Consignment A/c 20,000 By Arjun A/c (Sales) 30,000 To Cash A/c (freight 800 + insurance 700) 1,500 To Arjun A/c (sales expenses) 750 To Arjun A/c (commission 5% of 30,000) 1,500 To Profit transferred to Profit and Loss A/c 6,250 Total 30,000 Total 30,000 Arjun's Account (Consignee)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Consignment A/c (Sales) 30,000 By Consignment A/c (sales expenses) 750 - CBSE 2020Set ANNUAL10 marksQ.Rao & Co. sent goods worth Rs. 10,000 on consignment to their agent Mehta & Co. of Bombay at proforma invoice price of cost plus 20%. Rao & Co. paid Rs. 500 as expenses. Mehta & Co. sent advance of Rs. 6,000 and net carriage Rs. 600. Other expenses Rs. 400. Mehta & Co. sold all the goods for Rs. 18,500 and they are entitled to 5% commission. Prepare necessary ledger accounts in the books of Rao & Co.
›Reveal solutionSolution
Against sales of Rs. 18,500 we charge the cost of goods Rs. 10,000, consignor's expenses Rs. 500, consignee's expenses Rs. 1,000 (carriage 600 + other 400) and commission Rs. 925 (5% of 18,500). Consignment profit = Rs. 6,075. As every unit was sold there is no closing stock, so the proforma invoice loading (cost + 20%) fully cancels and profit is the same as on cost.
Consignment to Bombay Account (books of Rao and Co.)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods sent on consignment 10,000 By Mehta and Co. (Sales) 18,500 To Bank (consignor's expenses) 500 To Mehta and Co. (carriage 600 + other 400) 1,000 To Mehta and Co. (commission 5% of 18,500) 925 To Profit transferred to P and L A/c 6,075 18,500 18,500 Mehta and Co. Account (consignee's personal account)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Consignment A/c (Sales) 18,500 By Bank (advance) 6,000 - CBSE 2019Set ANNUAL10 marksQ.Gopal & Co. of Mumbai consigned 100 T.V. sets to Nikhil of Hyderabad. The cost of each T.V. was ₹ 600. Gopal paid insurance ₹ 1,000, and freight ₹ 1,000. Account sales were received from Nikhil showing the sale of 80 TV sets at ₹ 800 each. The following expenses were deducted by Nikhil: Selling Expenses ₹ 500 Commission 10% on sales Gopal received a bank draft for the balance due and prepared important Ledger Accounts in the books of Gopal.
›Reveal solutionSolution
Gopal consigns 100 TV sets costing ₹600 each (₹60,000) and pays ₹2,000 expenses; Nikhil sells 80 sets at ₹800 (₹64,000), deducting ₹500 selling expenses and ₹6,400 commission. Closing stock of 20 sets is valued at ₹12,400, consignment profit is ₹7,500, and Nikhil remits a bank draft of ₹57,100.
This TS Intermediate 2nd-year Accountancy consignment problem requires the Consignment Account, the Consignee's (Nikhil's) Account and the stock valuation in the consignor's books.
Valuation of unsold stock (20 sets) — at cost plus proportionate non-recurring (consignor) expenses:
- Cost: 20 x 600 = 12,000
- Proportionate consignor expenses: 2,000 x (20/100) = 400
- Closing stock = ₹12,400
Consignment to Hyderabad Account
Dr — Particulars Amount (₹) Cr — Particulars Amount (₹) To Goods Sent on Consignment (100 x 600) 60,000 By Nikhil (Sales 80 x 800) 64,000 To Bank (Insurance 1,000 + Freight 1,000) 2,000 By Consignment Stock c/d 12,400 To Nikhil (Selling Exp. 500 + Commission 6,400) 6,900 To Profit transferred to P&L A/c 7,500 Total 76,400 Total 76,400 Commission = 10% of 64,000 sales = ₹6,400. Profit = 76,400 - (60,000 + 2,000 + 6,900) = ₹7,500.
Nikhil's Account (Consignee)
| Dr — Particulars | Amount (₹) | Cr — Particulars | Amount (₹) |
|---|---|---|---| …
- CBSE 2018Set ANNUAL10 marksQ.Vaishnavi of Hyderabad consigned goods valued at ₹ 30,000 to Jahnavi of Delhi. Vaishnavi paid cartage and other expenses ₹ 2,000. Jahnavi sent the account sales with the following information:(i) 50% of the goods sold for ₹ 22,000.(ii) Jahnavi incurred expenses amounting to ₹ 1200.(iii) Jahnavi is entitled to receive commission @ 5% on sales. A bank draft was enclosed for the balance. Prepare the necessary ledger accounts in the books of Vaishnavi.
›Reveal solutionSolution
Load the Consignment A/c with cost ₹30,000, consignor's cartage ₹2,000, consignee's expenses ₹1,200 and commission ₹1,100; credit it with sales ₹22,000 and unsold stock ₹16,000. The balancing profit is ₹3,700. Jahnavi remits the balance of ₹19,700 by bank draft.
Working 1 — Commission. 5% on sales of ₹22,000 = ₹1,100.
Working 2 — Value of unsold stock. 50% of the goods are unsold. Unsold stock is valued at proportionate cost plus a proportionate share of the consignor's non-recurring (sending) expenses; the consignee's ₹1,200 is treated as recurring selling expenditure and is not added to stock.
- Proportionate cost = 50% of 30,000 = 15,000
- Proportionate consignor's expenses = 50% of 2,000 = 1,000
- Value of unsold stock = 15,000 + 1,000 = ₹16,000
Consignment Account (in the books of Vaishnavi)
Particulars Amount (₹) Particulars Amount (₹) To Goods sent on consignment 30,000 By Jahnavi — Sales 22,000 To Bank — cartage & other expenses 2,000 By Consignment Stock c/d 16,000 To Jahnavi — expenses 1,200 To Jahnavi — commission (5% of 22,000) 1,100 To Profit on consignment (to P&L A/c) 3,700 Total 38,000 Total 38,000 Jahnavi's Account (Consignee)
| Particulars | Amount (₹) | Particulars | Amount (₹) |
| --- | --- | --- | --- | …
- CBSE 2017Set ANNUAL10 marksQ.Western Radio House of Madras consigned 200 radios to Rama Brothers of Hyderabad. The cost of each radio was Rs. 400. Radio House paid Rs. 5,000 for freight and insurance. Rama Brothers accepted a three-month bill drawn upon them by Radio House for Rs. 50,000. Rama Brothers paid Rs. 2,400 as rent and Rs. 1,300 for advertisement. They sold 100 radios at Rs. 520 each. Rama Brothers is entitled to a commission of 10% on sales. Prepare the necessary ledger account in the book of Radio House assuming that Rama Brothers sent a bank draft for the balance due to Radio House.
›Reveal solutionSolution
Consignment of 200 radios (cost Rs. 400 each). Value unsold 100 radios at Rs. 42,500 (cost + proportionate freight). Consignment profit = Rs. 600. On settlement, the Rs. 50,000 bill already accepted is larger than the net amount due, so Rama Brothers' account carries a Rs. 6,900 balance in their favour.
This is a TS Intermediate 2nd-year Accountancy consignment problem solved in the consignor's (Western Radio House) books.
Working — valuation of unsold stock (100 radios)
- Cost of 100 radios = 100 × 400 = Rs. 40,000
- Proportionate consignor's expenses (freight & insurance) = 5,000 × 100/200 = Rs. 2,500
- Consignee's expenses (rent, advertisement) are NOT added — they are selling expenses, not expenses to bring goods to a saleable location.
- Unsold stock value = 40,000 + 2,500 = Rs. 42,500
Consignment Account
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods sent on consignment (200 × 400) 80,000 By Rama Brothers — Sales (100 × 520) 52,000 To Cash — Freight & Insurance 5,000 By Consignment Stock A/c 42,500 To Rama Brothers — Expenses (2,400 + 1,300) 3,700 To Rama Brothers — Commission (10% of 52,000) 5,200 To Profit transferred to P&L A/c 600 Total 94,500 Total 94,500 Consignment Stock Account
Particulars Amount (Rs.) Particulars Amount (Rs.) To Consignment A/c 42,500 By Balance c/d 42,500 Total 42,500 Total 42,500 Rama Brothers' Account (consignee)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Consignment A/c (sales) 52,000 By Bills Receivable (bill accepted) 50,000 To Balance c/d (due to Rama Brothers) 6,900 By Consignment A/c (expenses) 3,700 By Consignment A/c (commission) 5,200 Total 58,900 Total 58,900 … - CBSE 2016Set ANNUAL10 marksQ.Vaishnavi of Hyderabad consigned goods valued at Rs. 30,000 to Jahnavi of Delhi. Vaishnavi paid cartage and other expenses Rs. 2,000. Jahnavi sent the account sales with the following information:(i) 50% of the goods sold for Rs. 22,000.(ii) Jahnavi incurred expenses amounting to Rs. 1200.(iii) Jahnavi is entitled to receive commission @ 5% on sales. A bank draft was enclosed for the balance. Prepare the necessary ledger accounts in the books of Vaishnavi.
›Reveal solutionSolution
Vaishnavi (consignor) sends goods worth Rs. 30,000 and spends Rs. 2,000. Jahnavi sells half for Rs. 22,000, spends Rs. 1,200 and charges 5% commission (Rs. 1,100). Unsold stock (50%) is valued at Rs. 16,000 (Rs. 15,000 cost + Rs. 1,000 proportionate consignor expenses). The Consignment Account shows a profit of Rs. 3,700 and Jahnavi remits a bank draft of Rs. 19,700. This is a TS Intermediate 2nd-year Accountancy consignment problem solved in the consignor's books.
Working — valuation of unsold stock
Only 50% of the goods are sold, so 50% remain. Vaishnavi's cartage and other expenses of Rs. 2,000 are non-recurring (incurred to get goods to the consignee), so a proportionate part is added to stock. Jahnavi's expenses of Rs. 1,200 are treated as recurring selling expenses (nothing in the account-sales suggests they are landing/unloading charges), so they are not added to stock.
- Cost of unsold goods = 50% of 30,000 = Rs. 15,000
- Add: proportionate consignor expenses = 50% of 2,000 = Rs. 1,000
- Value of closing stock = Rs. 16,000
Consignment to Delhi Account (in the books of Vaishnavi)
Particulars Amount (Rs.) Particulars Amount (Rs.) To Goods sent on consignment 30,000 By Jahnavi — Sales 22,000 To Bank — Vaishnavi's expenses 2,000 By Stock on consignment c/d 16,000 To Jahnavi — Expenses 1,200 To Jahnavi — Commission (5% of 22,000) 1,100 To Profit transferred to P&L A/c 3,700 Total 38,000 Total 38,000 Jahnavi's Account (Consignee)
| Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
|---|---|---|---| …
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