Question

Goods sold on credit to Kamal worth rs. 5000 on the 20%trade discount and 5% cash discount

Answer 1

Answer:

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Answer 2

Answer:

The answer is in the explanation section.

Explanation:

As the transaction is on credit, the only discount that we will consider is trade discount. Cash discount will not be included as the transaction is on credit and not on cash basis.

Journal entry is:

Kamal A/c  Dr.              4000

   To Sales A/c             4000

(Being goods sold on credit to Kamal @ 20% TD)

Working note:

5000 - (20% of 5000) = 4000

Hope this helps :)