Journalise- Paid cash ₹40,000 to Suresh, availed discount of 2%
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Given "Paid cash to Suresh 40000.. discount @2℅"
discount = 40000×2℅ = 800
The Journal Entry will be...
Suresh a/c Dr. 40000
To cash a/c. 39200
To discount received a/c 800
(Being cash paid to suresh)
Because... we know the Three golden rules of accounting...
Personal account Debit the receiver ,credit the giver
Real account Debit what comes in ,credit what goes out
Nominal account Debit All expenses and losses, credit All incomes and gains
Suresh is the receiver .so he should be debited... cash is going out and discount received is a gain.so they should be credited..
discount = 40000×2℅ = 800
The Journal Entry will be...
Suresh a/c Dr. 40000
To cash a/c. 39200
To discount received a/c 800
(Being cash paid to suresh)
Because... we know the Three golden rules of accounting...
Personal account Debit the receiver ,credit the giver
Real account Debit what comes in ,credit what goes out
Nominal account Debit All expenses and losses, credit All incomes and gains
Suresh is the receiver .so he should be debited... cash is going out and discount received is a gain.so they should be credited..
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