stock recieved but not yet paid for at year end

[stapler]

Hi (again)

I am completing my accounts prior to filing my self assessment online and have two questions please

Q1, Regards stock I have recieved but I have not yet paid for at year end

I understand I must include it in the cost of sales calculation (ie, in the stock take count) but where do I show the dept that I still owe for these goods ?

Q2, Also, at year end, some goods are on order but not yet recieved or paid for, do I include the value of these items anywhere ?

Once again many thanks

[King_Maker]

Assuming that "Cash" basis does not apply, you should have received invoice(s) for these items of stock? If so, the relevant figure would be included in Creditors.

[stapler]

Thanks for your reply, yes I have invoices which I then paid by cheque after 5th April

Will there be a box for creditors when I file my SE, I will be using the simple form for under 70K

if not, should I just deduct the amount owed from the gross profit

such as

Turnover £xxxx
Less cost of sales £xxxx
Gross Profit £xxxx
Less Creditors £xxxx
Less allowable expenses
Etc etc
Net Profit £xxxx

[mullet]

should I just deduct the amount owed from the gross profit

No, because that would give you a double deduction. Since the amount would have been included in purchases and creditors. In fact, you would make an addition to profit (through adjusting purchases), rather than a deduction from profit. That is because you would have bought stock which had not yet been used in generating income. You mention "cost of sales", but do you know how it is calculated?

Opening stock plus purchases less closing stock = cost of sales.

If you don't understand the basics, or if you can't work it out from information in forums such as this and HMRC's guidance notes, then you need professional help.

[stapler]

Many thanks

Yes I have calculated the cost of sales as you describe, except I had not added the recent invoices to the purchases, because I had not paid for them, in fact I have not included them anywhere yet, apart from they are included in the value of closing stock. This is why I was asking about where to allow for ceditors.

At the moment my accounts only amount to a few hundred pounds of sales, however I am keen to do it right and try to learn and understand the basics myself so that I have a better picture of how the business is doing, I take on board your comments and will certainly employ a professional at some point

[King_Maker]

Creditors is a Balance Sheet item, not P&L.

As mullet says, there will be a double counting.

I assume you are not using double-entry software.

[stapler]

Much appreciated to both of you, I am back on the right track now
Once again this forum has been fab