Question

Journal entry of goods sold to heralal for 18000 costing 14200 on credit

Answer 1

Journal entry is explained for better understanding.

Explanation:

   Cash A/c Dr. 3800

Heralal A/c Dr. 14200

         To Sales A/c 18000

• Cash account is the real account. we debited here according to the rule "Debit what comes in" . We receive 3800 only so we debited cash account with that amount.
• Heralal has become our debtor as we have to receive the balance amount from him so we debited his account .
• we credited the sales account as it is our income and we credit our income.