Question

ENTRY GOT SOLD GOODS COSTING RS2500 AT A PROFIT 40% ON COST

Answer 1

The entry is explained with necessary explanation.

Explanation:

The entry for this will be :

Cash A/c Dr. 3500

  To Sales A/c   2500

   To P&L A/c     1000

Cash account is debited with the total amount received from sales i.e. cost plus profit . Sales account is credited with the amount of goods sold. The rest amount is transfer to profit and loss account as it is our profit.