Question

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3 H Ltd. Forwarded on 1.7.2006, 100 bicycles to Vasu of Hyderabd to be sold on behalf of H Ltd. The cost of
each bicycle was 150 but the invoice price was 7200. H Ltd, incurred 71,000 on freight and insurance. Vasu
received the consignment on 14.7.2006 and accepted a three months draft drawn upon him by H Ltd. For
710.000. Vasu paid 400 as rent and 3250 as insurance and by 31.12.2006 had disposed of 80 bicycles at 3205
each. Vasu is entitled to a commission of 5% on sales including del credere commission of 1%. Vasu sold 20
bicycle on credit and was not able to recover sales proceeds of 5 bicycles because of insolvency of the
debtor.
Give journal entries to record the above transactions in the books of H Ltd. and Vasu.​

Answer 1

Explanation:

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3 H Ltd. Forwarded on 1.7.2006, 100 bicycles to Vasu of Hyderabd to be sold on behalf of H Ltd. The cost of

each bicycle was 150 but the invoice price was 7200. H Ltd, incurred 71,000 on freight and insurance. Vasu

received the consignment on 14.7.2006 and accepted a three months draft drawn upon him by H Ltd. For

710.000. Vasu paid 400 as rent and 3250 as insurance and by 31.12.2006 had disposed of 80 bicycles at 3205

each. Vasu is entitled to a commission of 5% on sales including del credere commission of 1%. Vasu sold 20

bicycle on credit and was not able to recover sales proceeds of 5 bicycles because of insolvency of the

debtor.

Give journal entries to record the above transactions in the books of H Ltd. and Vasu.

Answer 2

Explanation:

H Ltd. Forwarded on 1.7.2006, 100 bicycles to Vasu of Hyderabd to be sold on behalf of H Ltd. The cost of

each bicycle was 150 but the invoice price was 7200. H Ltd, incurred 71,000 on freight and insurance. Vasu

received the consignment on 14.7.2006 and accepted a three months draft drawn upon him by H Ltd. For

710.000. Vasu paid 400 as rent and 3250 as insurance and by 31.12.2006 had disposed of 80 bicycles at 3205

each. Vasu is entitled to a commission of 5% on sales including del credere commission of 1%. Vasu sold 20

bicycle on credit and was not able to recover sales proceeds of 5 bicycles because of insolvency of the

debtor.

Give journal entries to record the above transactions in the books of H Ltd. and Vasu.