Question

Sold goods costing 10000 at cost plus 20 less 10 % trade discount to piyush. what is the journal?

Answer 1

At cost plus 20 less means

Answer 2

3 golden rules

• debit the receiver , credit the giver

• debit what comes in , credit what goes out

• debit all the expenses and losses , credit all the incomes and gains

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reason for debit and credi

sales A/c - Nominal A/c , its a income to the company therefore its credited

Piyush A/c - personal A/c , where the debtor is receiver of goods therefore its debited .

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Caluculation of sales

cost =10000

sales =10000+(10000*20%)

=10000+2000

=12000

net sales = sales - trade discount

= 12000-(12000*10%)

=12000-1200

=10800

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Journal entry

Piyush A/c Dr 10800

To Sales A/c 10800

(Being credit sales made )

note : trade discount should be deducted from sales amount .

no journal entry passed for trade discount

Hope its useful..!!