Question

sold goods costing 60000 to Kishore against cheque at a profit of 25% on cost less 10% trade discount. Cash discount allowed @2% on sale price. Journal Entry

Answer 1

Answer:

Given" Sold goods of rupees 60,000 to vimal received 50% of due akount allowing 2% discount... journal entry"

This transaction affects four accounts.. sales account (Goods are sold) , Vimal account (sold to vimal) , Cash account (50% of the amount is paid in cash), cash Discount allowing (Discount being allowed)

Actual Price= 60000

out of 8000.. 50%is paid out in cash and rest on credit... 60000 × 50% = 30000

cash Discount= 2%

Cash Discount amount= 30000 × 2% = 600

Actual cash receivable = 30000

But since cash Discount is allowed d.. actual cash will be 30000-600 =29400

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 ,credit what goes out

segregating accounts: -

Real accounts..all assets and Liabilities come under it

Nominal accounts...all incomes gains losses expenses come under it

Personal account..as the Name suggests..

Cash is an asset and its coming in .it should be debited.

cash Discount allowed is a loss..it should be debited ..

sales is an income it should be credited.

Vimal is the receiver..he should be debited..

So the Journal Entry will be.....

Vimal a/c Dr 30000

Cash a/c Dr 29400

Discount recieved Dr a/c 600

To Sales a/c 60000

(Being Goods Sold on credit to vimal)

Explanation: