Question

Loan repaid rs20000 being. Rs12000as interest and8000asprincipal amount

Answer 1

Loan A/C. Dr. Rs.8000

Interest A/C. Dr. Rs.12,000

To Cash A/C.(or) Bank A/C Rs.20,000

(Being loan repaid along with interest)

Explanation :

Loan is a liability. When it is repaid, liability decreases . Therefore, it is debited.

Interest paid is an expense to the business. Hence debited.

Cash Balance or Bank balance is reducing. Hence credited.

Answer 2

Hey mate ✌️✌️

Journal Entry ⏬⏬⏬⏬


Loan A/c..................................Dr....12000
Interest A/c..............................Dr....8000
..............To cash A/c.....20000

✨ Hope this helps you ✨