accounting matter?????

Accounting cycle:

After you've posted the activity transactions, you need to begin closing the books on your worksheet.

Copy the trial balance into the first two columns.

(This sounds like where you've left off...)

Now you have to make adjusting entries:

accrued rents

accrued interest

accrued payroll

etc...

The inventory is one of them. What you do is conduct a hands-on count of everything left unsold and apply a value to it. One of the adjusting entries is to adjust your inventory balance to actual. (Your textbook might say that you do this only if you have a periodic inventory. In reality, you do it whether you have periodic or perpetual because you likely have a problem with "shrinkage".)

The entry for the inventory is:

Cost of goods sold (dr)

Inventory (cr)

for whatever number it takes to get your account to match your hands on valuation.

Inventory unsold at end of accounting period will be your ending balance of inventory sitting in balance sheet.

Eg: Balance Sheets:

1. Cash

2. Prepaid

3. Inventory unsold

4. Fixed Assets

Total assets ......................

that will be added to your closing stock in ur balance sheet !