Index trade margin used in the formation of prices for goods sold by retailers. To account for the amounts of trade margins, account 42 is used. In the article, we will talk about the procedure for forming the realized margin on goods and, using an example, consider account 42.
According to the legislation, each enterprise has the right to independently determine the retail price of the goods sold. Consequently, the amount of the trade margin and, as a consequence, the selling price of the goods, is determined by the organization in each individual case. At the same time, according to the recommendations of the Ministry of Economy, the selling price of the goods must correspond to market conditions, as well as cover possible selling expenses and include the amount of income that the organization plans to receive from.
The amount of the trade margin is determined as a percentage of the purchase price of the goods. When deciding on the amount of the trade margin for a product, an organization must record this indicator in the retail price register. This document is the basis for recording transactions on account 42. The law does not establish a mandatory form according to which the register must be drawn up. The organization can independently draw up a register form and approve its form in accounting documents.
Sub-accounts 42 accounts:
Typical postings on account 42
Account 42 is used to reflect generalized information on the amount of markup on goods. According to Kt 42, the amount of the accrued trade margin is carried out, according to Dt 42 - the write-off of the margin in connection with the sale of goods, a decrease in the amount of the margin, etc. Consider the account 42:
Forming a markup on a product - an example
Velikan LLC purchased from Magnit LLC a consignment of goods (150 irons) worth 324,500 rubles, VAT 49,500 rubles. The trade margin on goods was 35%. Determining the amount of the trade margin and the indicator of the selling price of the goods, the accountant of Velikan LLC made the following calculations:
- The trade margin for a consignment of goods is 96,250 rubles. ((324,500 rubles - 49,500 rubles) * 35%).
- The selling price of a consignment of goods is 371,250 rubles. (324,500 rubles - 49,500 rubles + 96,250 rubles).
- The retail price of a unit of goods (one iron) is 2,475 rubles. (371,250 rubles / 15 pcs.).
Reflecting the operations in accounting, the accountant of Velikan LLC made the following entries:
Postings for writing off markups on goods sold
LLC "Rynok Plus" operates in the field of retail trade. According to the accounting policy, the goods at the enterprise are accounted for at the selling price.
As of 02/01/2016, in the accounting of Rynok Plus LLC, the balance for Dt 41 is 471,200 rubles, for Kt 42 - 193,000 rubles.
During February 2016, Rynok Plus LLC carried out the following operations:
- Purchased goods in the amount of 942,000 rubles. without VAT. Trade margin - 403,000 rubles. Sale price - 1,345,000 rubles. (942,000 rubles + 403,000 rubles).
- Goods sold in the amount of 1,418,300 rubles, VAT 216,351 rubles. Expenses for the sale of goods - 88,200 rubles.
The cost of goods, the balance of which is on .02.2016, amounted to 397,900 rubles. (471,200 rubles + 1,345,000 rubles - 1,418,300 rubles).
The average percentage of the markup that applies to sold products, the accountant of Rynok Plus LLC, calculated as follows:
((193,000 rubles + 403,000 rubles) / (1,418,300 rubles + 397,900 rubles) * 100%) = 32.81%.
In the accounting of Rynok Plus LLC, the following entries were made:
| Dt | ct | Description | Sum | Document |
| 50 | 90.1 | Revenue for February 2016 went to the cash desk of Rynok Plus LLC | RUB 1,418,300 | Incoming cash order |
| 90.2 | 41 | Selling value goods sold included in expenses | RUB 1,418,300 | Implementation Report |
| 90.2 | 42 | Reversal of the trade margin on goods sold (1,418,300 rubles * 32.81%) | RUB 465,345 | Register of retail prices, accounting reference-calculation |
| 90.3 | 68 VAT | The amount of VAT charged on the goods sold | RUB 216,351 | Implementation Report |
| 90.2 | 44 | Implementation costs are included in expenses | RUB 88,200 | Expense Report |
| 90.9 | 99 | At the end of February 2016, the amount financial result(465,345 rubles - 216,351 rubles - 88,200 rubles) | RUB 160,794 | Turnover balance sheet |
One of the types of entrepreneurship is wholesale and retail trade in products and goods. In this case, the seller's profit is considered to be the trade margin, which is the difference between the initial cost of the goods and the final sale price. In the article, we will analyze the meaning and definition of the trade margin, as well as accounting entries on account 42.
The value of the trade margin
In order to obtain the planned profit, the seller, when selling the goods, forms the cost using the amount of the markup on the initial cost. The resulting difference should cover all estimated costs, including the following:
- VAT and other indirect taxes;
- sales costs (third party services, employee salaries);
- other expenses.
At the same time, the markup provides not only coverage of costs, but also the profit of the seller. At the same time, the value of the trade margin should not interfere with the further competitiveness of the product on the market compared to other similar items.
Video lesson. Account 42 in accounting “Trade margin”: examples
Video lesson on accounting on account 42 “Trade margin”. Lesson leads Chief Accountant, expert, lecturer of the site Gandeva N.V. Typical situations, examples and postings are considered ⇓
Determining the trade margin
To determine the final cost of goods in wholesale and retail trade, different algorithms are used.
In case of wholesale sales, the trade margin is the difference between the selling wholesale price and the purchase price.
To account for retail trade, it is allowed to accept goods not only at cost, but also at final selling prices. Such actions are permissible, since sometimes it is impossible to determine the natural value of a unit of goods. An exception is a unit of large production, for example, household appliances. But when implementing more small goods(stationery, food) detailed accounting is not possible. In retail firms, it is preferable in such cases to take into account the goods at selling prices.
The selling price of the goods consists of the cost price and the added margin. The latter value can be set by organizations themselves, with some exceptions indicated below.
It is allowed to set the markup using the Register of retail prices approved by the head. For any type of product, information is provided about the supplier, the purchase price, the margin in % terms, and the final market price. For each place of subsequent sale, its own price can be set.
An approved registry might look like this:
| Product | Provider | Cost price | markup 1 | Retail price 1 | markup 2 | Retail price 2 |
| Pen | LLC "Prestige" | RUB 45.00 | 30% | RUB 58.50 | 35% | RUB 60.75 |
| Pen | OOO "Titan" | RUB 54.00 | 30% | RUB 70.20 | 35% | RUB 72.90 |
| Pencil | Mechta LLC | RUB 25.00 | 30% | RUB 32.50 | 35% | RUB 33.75 |
The markup can also be the same for all types of goods or depend on their type. The chosen method of determining retail prices is recommended to be fixed in the current accounting policy.
State regulation of pricing
Prices for certain products are controlled by the state. The government determines the allowable cost for individual goods with special social significance. If the product is on the Price Controlled Products List, then their total cost, including the markup, must be formed in accordance with current laws and regulations at the federal and local levels.
If there is a steady increase in prices for goods of social importance, the Government has the right to temporarily limit their maximum limit. But it is possible to do this if the level of price increase exceeds 30% over a 30-day period. The maximum allowable value of such goods, set by the Government, may be maintained for up to 90 days.
Socially significant goods include the following: meat, milk, sunflower and butter, flour, eggs, sugar, salt, bread, cereals, potatoes, some types of fruits and vegetables. In addition to food products, the list of goods for which control over selling prices can be established includes children's goods, medicines, medical products, goods intended for sale in the Far North and areas equated to it.
In case of detection of cases of overpricing for goods regulated by the states, responsible persons and organizations expect fines. Fines of up to 50,000 rubles are provided for management, for legal entities― twice the amount of revenue exceeded as a result of overstatement for the entire period of overstatement, but with a total duration of no more than a year.
Accounting for the trade margin (account 42: postings)
In the accounting of trade enterprises, the accounting of the trade margin is carried out separately. For these purposes, the Trade Margin account is used. All sorts of discounts and product losses and other data can also be reflected here.
The following transactions can be used to determine the markup:
- Dt 41-2 - Kt 42 - the markup is reflected.
- Dt 90 - Kt 42 - the amount of markup as a result of damage, loss of goods was reversed.
For the rest of the goods, the markup is determined as follows: a percentage consisting of the ratio at the beginning of the month of the amount of the markup for commodity balances and received per month to the amount of goods sold and final balances. The amount of goods sold is determined by selling prices.
In organizations paying VAT, the formation and accounting of the markup is different. For example, tax evaders (organizations on the simplified tax system or exempt from VAT) form a margin on account 42 itself.
If a trading company is a payer of this indirect tax, then it must use 2 sub-accounts:
- 42-1 - accrued margin on the price from the supplier;
- 42-2 - VAT on the sale price, which is part of the margin.
When selling goods at retail, the amount of tax is included in the final price.
Example. Trading company, which is a VAT payer, purchased goods for further sale at a price of 354 rubles per unit, including 18% VAT. Quantity of goods - 80 pieces. The value of the trade margin is 20%. In accounting, the company uses sub-accounts 42-1 and 42-2.
The following transactions will be reflected in the accounting:
Dt 41-2 - Kt 60 - 300*80=24000 rub. ― the goods are received from the supplier.
Dt 19 - Kt 60 - 54 * 80 * = 4320 rubles. ― the input VAT from the supplier is reflected.
Dt 68 - Kt 19 - 4320 rubles. - the amount of tax is accepted for deduction.
Dt 41-2 - Kt 42-1 - 4800 rubles. - trade margin on the price of goods without tax.
Dt 41-2 - Kt 42-2 - 864 rubles. ― VAT is included in the trade margin.
The total markup is 4800 rubles. + 864 rub. = 5664 rubles for the total batch of goods received. At the same time, the selling price of 1 unit of goods is 424.80 rubles.
Under certain circumstances, the trade margin may be reduced. This happens due to the sale, the need for a markdown. The markup reduction operation is reversed by the following posting:
Dt 41 - Kt 42 - reversal of the size of the markup.
Dt 91-2 - Kt 41 - the excess of the amount of the reduction over the margin.
The main purpose of the existence of any commercial company is to generate income. For this reason, products or services are not sold by . If everything were so, the organization would work “to zero”. However, a trade margin is added to the cost, allowing you to make a profit.
What is a trade markup
The trade mark is certain amount, which is added to the cost of goods. This markup is made up of net income companies. In fact, this is the added value, which is formed by increasing the price. Cost is the total cost of manufacturing a product. These are expenses for transportation, raw materials, administrative, commercial and other expenses. The product is almost never sold at cost, since in this case the company will cover only its costs, but will not make a profit. The final cost of goods and services includes the cost price and the trade margin. This allows you to cover all expenses and make a profit.
The size of the markup in most cases is not set at the state level. But some items have price caps. If the cost exceeds the established figure, the company will have to pay a fine. This is an indirect limitation on the markup amount. These restrictions apply to essential products. However, it cannot be said that for all other goods it is possible to set a margin of any size. There is always such a factor as indirect restrictions. This is competition, the level of demand.
Example
The company is engaged in the production of footwear. The cost of one pair of shoes is 1000 rubles. The company sets a retail price of 1,500 rubles. That is, the markup was 50%. The boots are selling pretty well. They are in demand among target audience(CA), which prefers budget options. The firm, satisfied with sales, decides to increase the markup to 100%. That is, the cost of shoes will be 2,000 rubles. In this case, sales will fall, since the company has lost its target audience, but has not found new consumers, since the quality of the goods remains the same. That is, indirect restrictions continue to operate. Let's look at the company's earnings. The company sells 100 shoes per month. The cost of them will amount to 100,000 rubles. The company will receive revenue of 150,000 rubles. The profit formed from the margin will be 50,000 rubles.
On what factors does the markup depend?
The amount of the trade margin is formed on the basis of the following factors:
- Cost price. The cost of the goods, including the margin, must necessarily cover all the costs of the company for production. The cost may include transportation, management, commercial expenses, rent, electricity costs, depreciation.
- The segment in which the company operates. The markup percentage is directly dependent on the segment. In some seasonal industries, markups may vary throughout the year.
- elasticity of demand. This indicator reflects the dependence of demand on the increase or decrease in cost. If demand is elastic, when determining the markup, you need to keep in mind the need to establish discounts designed to increase demand. Even a product sold at a discount must be profitable. If demand is inelastic, the need for discounts can be ignored.
- Availability of additional services. Some companies offer free services included with the main service. For example, it can be a free consultation, installation. All these Additional services are free of charge rather conditionally, since the costs of them also affect the size of the markup.
- Features of the target audience. The manager needs to understand how much money the buyer can and is willing to pay for the product. It depends on the type of product, region, location of the company, level of competition.
- Competition. The markup depends on the level of competition and competitiveness of the organization. For example, an organization operates in a highly competitive industry. In this case, the margin will be small. Otherwise, consumers will turn to a competitor offering a better price. However, a significant deviation from the average cost is possible if the company is highly competitive.
It must be said that the margin is not always rational. For example, there is such a thing as prestigious consumption. In this case, the products of prestigious brands are purchased at an inflated price. That is, the markup will be very high. Essentially, the consumer will pay for the brand.
IMPORTANT! It is important for a company to define a threshold cost. This is the minimum cost at which the goods will be sold, and the company will not be in a loss-making position.
ATTENTION! All items can be subject to the same markup. You can also set a separate margin for each product category.
Markup accounting
The accounting entries used will depend on which particular transaction is being carried out.
Write-off of markup when selling products
The markup must be written off after the sale of products. The total markup is calculated at the end of the month. At the same time, it is determined on the basis of the average size of mark-ups for all products. The average markup percentage is determined by this formula:
P \u003d (TNn + TNp - TNv) / (V + OT) x 100%
The formula uses these values:
- P - average % markup.
- ТНн - margin on the balance of products at the beginning of the reporting period.
- TNp - markup on products received during the reporting period.
- TNv - markup on products retired during the reporting period (for example, goods returned to the supplier).
- B is sales revenue.
- FROM - the balance of production at the end of the month.
After that, the markup amount is set:
TNr \u003d V x P / 100%
The determined markup amount will be reversed as follows:
DT90-2 KT42
Posting includes an indication of the amount of the operation and the name of the primary documents.
Markup reduction
Sometimes a company decides to reduce the cost of products. In this case, the markup will also decrease. This is reflected as follows:
DT41 KT42
The operation involves writing off part of the cost of the goods. It should be displayed like this:
DT91-2 KT41
IMPORTANT! If the markdown exceeds the markup, taxable income is not reduced.
Return of products
The consumer can return the product if it does not differ in proper quality: the presence of a marriage, an expired product. In this case, the company must return the money to the buyer. The wiring will be as follows:
DT90-2 KT42
In this case, you will need to reverse the tax accrued on the margin.
Markup accounting
After the size of the trade estimate is determined, it is necessary to fix it in the register of retail prices. The register is the primary document on the basis of which accounting entries are reflected. It fixes the retail price of the product. The amount of the markup is fixed using this posting:
DT41 KT42
IMPORTANT! The register is formed on the basis of Appendix No. 2 to the recommendations. However, there is no mandatory registry form. It can be created according to the needs of the company. But in any case, the primary documentation must contain the mandatory details specified in Article 9 of the Accounting Law.
Accounting support of transactions for the purchase and sale of products in retail, when accounting for assets in selling prices, is carried out by displaying the following main operations:
- Acceptance of goods from the supplier.
- Displaying the selling price in the accounting of the company, registering products with the company, fixing the trade margin on the account. .
- Transfer of assets to the end consumer, confirmation of his payment and full transfer of rights to the goods (completion of a purchase and sale transaction).
- Calculation of financial results of implementation, control of performance results.
The essence of the concept of retail: the sale of goods purchased from various suppliers to the final consumer individually or in small batches with the transfer of ownership of the product at the time of the transaction.
Retail trade - an operation for the sale of products under a sales contract drawn up orally (the time of conclusion is the receipt by the buyer of a check or other document confirming payment for the goods). Buyers' payment for purchased products can be accepted in cash using cash registers, in accordance with federal law 54-FZ dated May 22, 2003, or bank cards under an acquiring agreement concluded with the bank, if there is point of sale payment terminals.
Most often, accounting for products in companies whose main activity is recognized as retail is carried out at selling prices. Accounting for goods in retail in sales prices has a number of features in comparison with accounting in purchase prices.
The purchase of products is fixed on the account. (to maintain separate accounting for different types activities, a sub-account 41.2 can be additionally opened). The goods received from the supplier are immediately reflected in the prices of its sale to consumers. At the same time, an additional operation is carried out to account for the trade margin.
Note from the author! Trade margin - the difference between a certain selling price of a product and the cost of production (purchase cost and delivery costs of products). The allocation of the trade margin on a separate account is a generalization of information about the possible profit of the company in the implementation of retail trade.
Setting the trade markup
The retailer has the right to choose the method of setting the markup on their product.
Should be borne in mind! The method must be fixed in the accounting policy.
- A single markup percentage for all products, regardless of their cost (for example, 20% for each unit of the nomenclature).
- Fixed amount expressed in ruble equivalent (for example, 1000 rubles for the purchase price).
- The selling price of the goods is determined, then on the basis of this the amount of the established margin is calculated (for example, with a purchase price of 100 rubles, the sale price is 120 rubles, which means that the trade margin for the goods is 20 rubles).
Evaluation of the effectiveness of the established margins is analyzed when closing an account intended for summing up the results of the enterprise.
The main postings when accounting for products at retail sales prices:
- Purchasing products for resale
- Sales to retail consumers
Operation
Wiring
Transfer of products, cost write-off
Dt90.02 Kt41
Reversal of markup amounts
Dt90.02 Kt42
Accounting for proceeds from the sale
Dt62.R Kt90.01 (62.R - a separate sub-account for fixing retail operations)
Accounting for acquiring transactions (payment by buyers of goods by bank cards)
Dt57.03 Kt62R
Acceptance of cash from customers
Crediting to the settlement account of income from acquiring operations
Dt51 Kt57.03 (Dt91.02 Kt57.03 - bank commission for accepting and processing payments under an acquiring agreement)
Note! When setting discounts for goods, the trade margin is also reversed in correspondence from account 41.
- Determination of the financial result, analysis of ongoing activities
Dt90 Kt99 - profit.
Dt99 Kt90 - loss.
Features of writing off goods and providing discounts to customers
If the goods were written off for personal use in the organization, or shortages were identified during the inventory, then the accountant displays the operations of writing off the trade margin with the following entries:
Dt44 Kt42 - the amount of the markup on the goods used for the personal needs of the company is reversed.
Dt94 Kt42 - write-off of the trade margin for products that have retired due to shortages, damage or theft.
Practical example
Society with limited liability"Trava" is engaged in retail trade in trading floor shopping center. total cost of purchased goods amounted to 8,000 rubles (excluding VAT). In the accounting policy of LLC, a trade margin is fixed - 30% for the entire range.
When selling products in the store, discount card holders receive a 10% discount.
Business operations
Dt41 Kt60 - 8000 rubles - posting the item for further sale in the store.
Dt41 Kt42 - 2400 rubles - the amount of the established trade margin is displayed.
That is, the selling price of the goods is set: 10,400 rubles.
Dt50 Kt90.01 - 9360 - sale to the owner of a discount card, taking into account the discount.
Dt90.02 Kt41 - 10400 rubles. - write-off of the cost of sold products.
Dt90.02 Kt42 - 1040 - red reversal - reversal of the trade margin when taking into account the discount.
Dt90.02 Kt42 - 1360 - red reversal - reversal of the markup on sold products.
Determination of the financial result of the transaction
Dt90 Kt99 - 1360 - determination of the profit of the company.
Peculiarities of accounting for buyer's prepayment at retail
Retail trade does not provide for the concept of advance payments for goods; a transaction is considered completed when the product and ownership of it are transferred to the final consumer. As a result, all advance payments from buyers are displayed in the seller's accounting as follows:
- As accounts payable according to sch. 62, sub-account for accounting for advance payments (Dt50 Kt62).
- Then, at the time of transfer of products to the buyer, a transaction is made with the allocation of revenue - Dt62 Kt90.01.
- Final payment for the goods: Dt50 Kt62.
- Transfer of advance payment to settlement for goods Dt62 (sub-account of settlements on advance payments) Kt62.
T - turnover (the amount of goods sold per month) in sales prices - turnover on the credit of the account, sub-account "Revenue";
O to - the balance of goods at the end of the billing month in sales prices - the debit balance of the account.
H k \u003d O k x P
3. The amount of realized markup (Нр) is determined by summing the trade margin at the beginning of the month (Нн) and the received trade margin (Нп) minus the trade margin at the end of the month (Нк):
Hp \u003d Hk + Np - Hk
Consider an example of calculating and reflecting in accounting the average percentage of the markup and the amount of the realized markup (we do not consider the postings related to the issue of VAT reflection):
Suppose at the beginning of April 2010 the balance of goods at sales prices on the debit of the account was 600,000 rubles, and the trade margin (balance on the credit of the account) was 100,000 rubles.
In April, the store received goods from a supplier in the amount of 346,000 rubles.
The markup on goods is 20%.
Sales proceeds amounted to 500,000 rubles.
The accountant makes the following postings:
Debit Credit
- 346,000 rubles. - received goods from the supplier;
Debit Credit
- 69 200 rubles. (346,000 rubles x 20%) - the trade margin for the goods is reflected;
Debit Credit, sub-account "Revenue"
- 500,000 rubles. - received proceeds from the sale of goods;
- 500,000 rubles. - written off the cost of goods sold in selling prices.
In this case, the calculation will look like this.
First, the balance of goods (Ok) is calculated at the end of the month in sales prices:
600 000 rub. + 346,000 rubles. - 500,000 rubles. = 446,000 rubles.
1. The percentage of the trade margin (P) for the month will be equal to:
(100,000 rubles + 69,200 rubles) / (500,000 rubles + 446,000 rubles) x 100 = 169,200 rubles / RUB 946,000 = 17.89%.
2. The amount of markup on the balance of goods (Hk) was:
RUB 446,000 x 17.89% = RUB 79,789.40
3. The amount of the realized markup (Нр) will be equal to:
100 000 rub. + 69 200 rub. - RUB 79,789.40 = RUB 89,410.60
Then he makes a reversal posting to write off the realized markup:
Debit, sub-account "Cost of sales" Credit
