Question

goods purchased at 40000 at 10% t.d and 5% c.d and half the amount paid by cheque what is the journal entry
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Answer 1

Explanation:

Purchase A/C...DR. 45000

To Henry A/C. 17200

To Bank A/C. 25800

To Discount Received A/C 2000

Working Note-

..Purchase done for 50,000 out of which we got trade discount 10%=5000

..Cash discount received 4%=2000

SO AFTER DEDUCTING TRADE DISCOUNT FIRST AND THEN SECOND CASH DISCOUNT,we get amount 43,000

..NOW 60%of 43000paid in cheque which is 25800

..17,200is still credit

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