Enterprises purchase precious metals, debit "precious metals" and credit "central bank deposits" and other subjects. When selling precious metals, according to the actual amount received, debit the subjects such as "money deposited in the central bank" and credit the subjects such as "other business income". According to its book balance, debit "other business expenses" and credit "precious metals". Details are as follows:

Accounting entries related to precious metals

1. When an enterprise purchases precious metals:

Borrow: precious metals

Loan: deposited in the central bank.

2. When the enterprise sells precious metals:

Borrow: deposit money in the central bank.

Loans: other business income

Debit: other business costs

Loans: precious metals

What is the content of precious metal accounting?

Precious metals in accounting practice refer to "precious metals" accounting subjects, which belong to assets. The accounting content is the cost of precious metal inventories such as gold and silver held by banks, which can be accounted in detail according to the categories of precious metals. Precious metals held by enterprises (finance) for listing transactions shall be treated as "transactional financial assets".

What does the debit balance of precious metals reflect?

Debit balance of precious metals at the end of the period reflects the cost of holding precious metal inventory by enterprises. Precious metals belong to the asset class, with debits indicating increase and credits indicating decrease.

Significance of precious metals

Precious metals mainly refer to eight metal elements such as gold, silver and platinum group metals (ruthenium, rhodium, palladium, osmium, iridium and platinum), among which gold is a common precious metal in the investment market, and investors can invest in gold in the following three ways:

1, physical transaction, physical gold transaction mainly aims at gold derivatives, mainly refers to the physical sale of gold, which mainly exists in the form of gold bars, coins, gold ornaments and so on. Market participants mainly include gold producers, refiners, investors and other demanders.

2. Paper gold trading. Paper gold trading is a service provided by banks, without the intervention of physical gold. It's an account in precious metals. It invests in gold not through physical transaction and delivery, but through bookkeeping, so it does not involve the delivery of physical gold, and the transaction cost is lower.

3. Gold futures trading, gold futures trading is to sell and buy back contracts with the same number as previous contracts before the contract expires, which is also called liquidation, and there is no need to actually deliver real money and silver. The profit or loss of each transaction is equal to the difference between two contracts in opposite directions.