Bought books rupees 40000 and paper rupees 3500 in cash
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books and paper come under Stationery
Stationery= 40000+3500 = 43500
The Current transaction affects two accounts Stationery account(it is a nominal account;all losses Gains income expenses come under nominal account;salary is an expense),, cash account.. because its Paid in/cash ...(it is a Real account; all assets and Liabilities come under Real account; cash balance is an asset) ..
The Three golden rules of accounting are....
Personal Account: Debit the receiver, credit the giver
Nominal account: Debit All expenses and losses, credit All incomes and gains
Real Account: Debit what comes in ,credit what goes out
In contention with the above rules...
Stationery account should be debited (it is a nominal account/its an expense)
cash account should be credited (it is a Real account/cash is Going out account should be debited (it is a nominal account/its an expense)
The Journal Entry will be....
Stationery a/c Dr 43500
To cash a/c. 43500
(Being Stationery paid)
Stationery= 40000+3500 = 43500
The Current transaction affects two accounts Stationery account(it is a nominal account;all losses Gains income expenses come under nominal account;salary is an expense),, cash account.. because its Paid in/cash ...(it is a Real account; all assets and Liabilities come under Real account; cash balance is an asset) ..
The Three golden rules of accounting are....
Personal Account: Debit the receiver, credit the giver
Nominal account: Debit All expenses and losses, credit All incomes and gains
Real Account: Debit what comes in ,credit what goes out
In contention with the above rules...
Stationery account should be debited (it is a nominal account/its an expense)
cash account should be credited (it is a Real account/cash is Going out account should be debited (it is a nominal account/its an expense)
The Journal Entry will be....
Stationery a/c Dr 43500
To cash a/c. 43500
(Being Stationery paid)
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