Question

119. [B]. Journalise the following transactions: (i) Goods sold for cash Rs. 3,000 and collected Sales Tax Rs. 210 on it. (ii) Paid for owners Life Insurance Premium Rs. 500 and Income Tax Rs. 3,000 (iii) Purchased horse for business Rs. 5,000. (iv) Paid to Manish on behalf of Manuj Rs. 10,000.​

Answer 1

Journal Entries For The Transactions above

Explanation:

(i)        Cash  A/c     Dr.                                    3,210

          To Sales A/c                                                             3,000

          To Sales Tax A/c                                                          210

     ( Being goods sold for cash and sales tax collected )

(ii)       Drawings A/c    Dr.                               3,500

          To Cash A/c                                                              3,500

     ( Being Owner's LIP & Income Tax paid )

(iii)       Horse A/c         Dr.                               5,000  

           To Cash A/c                                                              5,000

     ( Being Biological asset purchased )

(iv)       Manish's A/c     Dr.                             10,000  

           To Manuj's A/c                                                          10,000

     ( Being Paid to Manish On behalf of Manuj )