Question

Q. 11. Pass journal entries for the following:
2019
Jan Purchased goods trom Henry for 250,000 on 10% trade discount and cah
discount and paid 60% amount by cheque.​

Answer 1

Purchase A/C.........Dr. 225000

To, Bank A/C 135000

To, Henry A/C. 90000

(Being Purchased from henry 10% trade discount received and 60% payment is done by cheque)

Explanation:

Trade discount is given supplier in the basis of catalogue price which is done because of business consideration.

It is not seperately shown in the books of accounts.

Cash discount is shown in the books of accounts.