Question

Goods costing 8000 was sold for 10000 for cash

Answer 1

Cash a/c. Dr. 10000
To sales a/c. 8000
To profit on sale. 2000
Of goods a/c

Answer 2

                                    JOURNAL ENTRY

Cash A/c                              ---------Dr.                      10,000

        To sales A/c                                                                 8,000

        To profit on the sale of Goods                                   2,000

(Being goods sold on profit)

In this question,

The cost price of goods is Rs. 8,000 and Selling price is Rs.10,000. That implies the goods are sold on profit of Rs. 2000 ( 10,000 - 8,000) So for the recording in the Journal , Profit on sale of goods A/c will be opened.

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