purchased at 10% trade discount goods from A, the list price being rs 5000
Answers
Answer:
Bansal Traders allow a trade discount of 10% on the list price of the goods purchased from them. Mohan traders, who runs a retail shop made the following purchase fro Bansal Traders.
Date Amt.(Rs.)
Dec 21, 2005 1,000
Dec 26, 2005 1,200
Dec 18, 2005 2,000
Dec 31, 2005 5,000
For all the purchase, Mohan Traders drew promissory note in favour of Bansal Traders payable after 30 days. The promissory note for the sale of December 21, 2010 was retained by Bansal Traders with them till the date of its maturity. The promissory note drawn on 26.12.2010 was discounted by Bansal Traders from their bank at 12% per annum. The promissory note drawn on December 28, 2010 was endorsed by Bansal Traders in favour of their creditor Dream Soaps in full settlement of a purchase amounting to Rs. 1,900. On 25.1.2011 Bansal Traders sent the promissory note drawn on December 31, 2010 to their bank for collection.
All the promissory notes were met by Mohan Traders. Record the necessary Journal entries for the above transactions in the books of Bansal Traders and Mohan Traders and prepare Mohan Traders account in the books of Bansal Traders and Bansal Traders account in the books of Mohan Traders.
Answer:
purchase a/c. Dr. 500
To A a/c 500
(Being the goods purchased at trade discount)