Question 26.
Oswal Woollen Mills, Amritsar (Punjab) sold shawls to Gupta Shawls, Jaipur as per details: Sold 100 shawls @ ₹ 200 per shawl on 4th January, 2018, IGST is levied @ 12%. Trade Discount 25% and Cash Discount 5% if full payment is made within 14 days. Gupta Shawls sent 50% of the payment on 14th January, 2018 and balance payment on 10th February,2018. Pass Journal entries.
Answers
The journal entry for the following is shown below:
Explanation:
The journal entry for the following is as follows:
Jan 04
Gupta Shawls A/c...................................Dr Rs 16,800
Sales A/c................................................Cr Rs 15,000
Output IGST A/c....................................Cr Rs 1,800
Being goods sold at trade discount of 25% and levied IGST at 12%
Jan 14
Cash A/c.........................................Dr Rs 8,400
Gupta Shawls A/c...........................Cr Rs 8,400
Being 50% of the payment is received
Feb 10
Cash A/c.........................................Dr Rs 8,400
Gupta Shawls A/c...........................Cr Rs 8,400
Being balance amount which is 50% of the payment is received
Working Note:
Trade discount = Amount × 25%
= Rs 20,000 × 25%
= Rs 4,000
Cash Discount = Amount × 5%
= Rs 20,000 × 5%
= Rs 1,000
So, sales made of Rs 15,000 (20,000 - 1,000 - 4,000)
Output IGST = Sales amount × 12%
= Rs 15,000 × 12%
= Rs 1,800
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