Question

goods sold on credit to Ramesh - ramesh a/c is debited and sales a/c is credited . state the accounting concept or convention . answer in one word​

Answer 1

Answer:

Accounting concept - dual concept

Explanation:

Personal a.c. _ Dr. the Receiver _ ramesh a.c

nominal a.c _ Cr. expenses and losses _ sales a.c

Answer 2

Dual Concept is followed here .

Goods sold on credit to Ramesh, his account will be debited and sales account will be credited, dual entry concept is followed here .

As, each and every transaction has dual effects so here dual aspect is followed.

Ramesh is purchasing goods on credit which means that firm is decreasing its stock but is increasing their debtor as well, and according to the purchasers point of view he is taking asset as well as he is increasing his liability as he is going to pay it afterwards.

Journal Entry in the books of seller -

Ramesh A/C DR

               To Sales A/C

( Being goods sold on credit )

Journal Entry in the books of purchaser -

Purchase A/C DR

            To Seller A/C

( Being goods purchased on seller )