Purchased goods of Rs. 90000 at 10% trade TD and 10% cash discount from rakesh and 1/3rd amount received by cheque
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Explanation:
If you purchased good for 90,000 (your local currency) with trade discount of 10%.
10% of 90,000 = 9,000
You were liable to pay 81,000 i.e. 90,000 less 9,000.
If you paid third of the amount due by cheque, this equal to 81,000/3 = 27,000
This left 54,000 payable by cash. You got 10% cash discount.
10% of 54,000 = 5,400.
Actual cash you paid was 54,000 less 5,400 = 48,600.
Having got the figure for each part, the following journal entries will be passed
Debit Purchases Account with 90,000
Credit Cash Account with 48,600
Credit Bank Account with 27,000
Credit Discount Received Account with 9,000
Credit Discount Received Account with 5,400
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