Revenue on Consignment Explained | CA Inter AS 9 | When Does the Consignor Record Sales? 📦 | Concept

In a consignment arrangement, the Consignor is the original owner of goods and the Consignee acts like an agent selling goods on behalf of the consignor. A very important accounting point is this: Sending goods to the consignee does not mean a sale has happened. Why? Because the ownership risk and control of goods still remain with the consignor until the consignee actually sells the goods to outside customers. Therefore: The goods lying with the consignee are still treated as Inventory by the consignor. Only when the consignee sells the goods to third parties does the consignor get the right to record Sales Revenue. This concept is one of the foundations of Revenue Recognition and Inventory Accounting. Learn Accounting through concepts and practical understanding with Sudarshan Sir. Call / WhatsApp: Website: #Consignment #RevenueRecognition #InventoryAccounting #CAInter #AdvancedAccounting #CAStudents #AccountingConcepts #CommerceStudents #ConceptClarity #AccountingClasses #FinancialReporting