Home – New Forums Money matters Stock purchased

  • This topic is empty.
Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • #989055
    JadeC
    Member
    • Total posts: 7
    Up
    0
    ::

    Hi

    I am hoping someone can steer me in the right direction.

    I have purchased and paid for stock for my business, that I am then selling to customers. Is the stock the business purchased a asset or liability??

    Cheers

    Jade :)

    #1170214
    Steve_Minshall
    Member
    • Total posts: 518
    Up
    0
    ::

    It is an asset until you sell it when it becomes a cost.

    If you had received it but not paid for it then the stock would be an asset (you have it in your possession) but your debt to the supplier would be a liability of equal value.

    Because you have paid you have converted one asset (cash) into another asset (stock).

    #1170215
    JadeC
    Member
    • Total posts: 7
    Up
    0
    ::
    Steve_Minshall, post: 197459 wrote:
    It is an asset until you sell it when it becomes a cost.

    If you had received it but not paid for it then the stock would be an asset (you have it in your possession) but your debt to the supplier would be a liability of equal value.

    Because you have paid you have converted one asset (cash) into another asset (stock).

    Thank you Steve now I just have to work out how to enter the stock into reckon one :)

Viewing 3 posts - 1 through 3 (of 3 total)
  • You must be logged in to reply to this topic.