Question

Received rs 975 from shyam on his account for rs 1000

Answer 1

cash a/c.. 975
Disc. allow a/c. 25
To shyam a/c 1000

Answer 2

1. Cash/Bank A/c.........Dr.      975

To, Shyam A/c                            975

(Being received Rs. 975 from Shyam in full settlement)

In this entry we assumed that shyam paid the sum of amount in full settlement

2. Cash/Bank A/c...............Dr.                  975

   Discount Allowed A/c....Dr.                 25

To, Shyam A/c                                                               1000

(Being received Rs. 975 from Shyam)

In 2nd case we assume that shyam allowed to shyam of Rs. 25