Question

Sold good coasting rs 60000 at 50% profit to partap of ranchi IGST 12%

Answer 1

Given Goods costing 60000 Sold at a profit 50% to pratap of ranchi at IGST 12%


cost = 60000

Profit rate = 50%

Selling Price = 60000 + 50% = 90000


IGST rate = 12%

IGST amount = 90000×12%= 10800

so total amount receivable = selling price + IGST= 90000 + 10800 = 100800.

This transaction affects three accounts... Pratap account (Goods sold to him on credit) , IGST (tax payable) , Sales account (Goods are sold)

The Three golden rules of accounting are...

Personal account - Debit the receiver, credit the giver

Nominal account - Debit All expenses and losses, credit All incomes and gains

Real account - Debit what comes in, creditwhat goes out.


Pratap is the giver.so he should be debited....

Sales is an income so it should be credited..

so the Journal Entry will be...

Pratap a/c Dr. 100800

To Sales a/c 90000

To IGST a/c. 10800

(Being Goods Sold to pratap)