The reason for treating carriage inwards in the trading a...
The reason for treating carriage inwards in the trading account is because
It is an expense on goods sold to customer
Carriage outwards is an expense item in the profit and loss account
It is an expense on goods purchased
It does not appear in the balance sheet
Correct answer is C
Carriage inwards is the cost of transportation charged on goods purchased. It must be added to the goods purchased. Carriage inwards is the cost incurred in order to bring the goods purchased to the present location hence it is debited to trading account.
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