Question

Record necessary journal entries in the following cases:

[a] Creditors worth Rs.85,000 accepted Rs.40,000 as cash and Investment worth Rs.43,000,

in full settlement of their claim.

[b] Creditors were Rs.16,000. They accepted Machinery valued at Rs.18,000 in settlement of

their claim.

[c] Creditors were Rs.90,000. They accepted Buildings valued Rs.1,20,000 and paid cash to

the firm Rs.30,000. [4M]​

Answer 1

Answer:

(a) Realisation A/C..... Dr. 40000

To Cash A/C 40000

(Being cash paid on partial settlement of creditors)

(b) No entry is passed since full settlement of creditors is made by taking over Machinery.

(c) Cash A/C...... Dr. 30000

To Realisation A/C 30000

(Being cash received on partial settlement of creditors)

Explanation:

MARK ME AS BRAIN LIST

MARK ME AS BRAIN LIST