Question

Goods sold to manju for cash 10,000​

Answer 1

ANSWER :

❒ Given transaction is :-

• Goods sold to manju for cash Rs. 10,000

❒ Journal Entry of this transaction is :-

• $\mapsto: \: \: \sf{ \large{Cash \: \: A/C \: \: Dr. \: \: \: \: \: \: \: \: \: Rs. \: 10000}} \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \\ \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \sf{ \large{ \: \: To \: \: \: Sales\: \: \: \: A/C \: \: \: \: \: \: \: \: \: \: \: \:\:Rs. \: 10000}} \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \\ \\ \sf{ \large{[ \: Being \: \: goods\: \: sold \: \: for \: \: cash \:] }} \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \: \:$

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EXPLANATION :

❖ The three steps involved in the process of journalising the given transaction are :-

• Step 1. Identification of accounts : In this transaction, Rent paid in cash. Hence, the two accounts involve in this transaction are : Cash A/C and Sales A/C.

• Step 2. Classification of accounts : According to the Modern Approach of classification, Cash A/C is an Asset Account and Sales A/C is an Revenue Account.

• Step 3. Application of Debit and Credit rule : When goods sold in cash, the Asset in the form of Cash increases. Therefore, Cash A/C will be debited (as per the rule being Assets increase: debited). Again, when goods sold in cash, revenue increases. Hence, Sales A/C will be credited (as per the rule being Revenue increase: credited).