Cash paid to Sohan ₹7000 in fullsettlement.
Answers
Answer:
Here’s the answer to your question:-
I am going to explain through the business’s point of view. As a result, Mohan will be treated as a debtor of the business.
In such a case, there could be two scenarios.
The debtor was liable to pay the sum total(actual amount due) of Rs.7500 and he has paid it in full settlement of his claim. A full settlement means the creditor has made the entire payment in a lump sum and has no dues left.
Here, the journal entry would be like:-
Cash A/c Dr. 7500(Debited)
To Mohan’s A/c 7500(Credited)
2. The debtor was liable to pay Rs.8000 but is not in the position to pay the full amount. As a result, he has paid Rs.7500 in full settlement of his claim.
Here, the journal entry would be like:-
Cash A/c Dr. 7500(Debited)
Discount Allowed A/c Dr. 500(Debited)
To Mohan’s A/c 8000(Credited)
Logic:- Cash A/c is debited because we’re receiving cash from the debtor. As a result, our assets increases, and an increase in assets are recorded on the debit side as per the modern approach.
The discount allowed account is debited because it’s a loss for the business and all the losses and expenses are debited as per the golden rule for nominal accounts.
On the other hand, Mohan's A/c is credited because he’s the giver of the money, and the giver is credited as per the golden rule for personal accounts.
Mohan’s Account is also credited because he was an asset(the debtor) of the business and a decrease in assets is recorded on the credit side as per the modern approach.
the barrel roll is a custom made for skilled players and straightenin is a great way to make a difference in amazon and straightenin and straightenin