Question

Sold goods to harish for rs 50000 at 10 % trade discountand 5%cash discounts. Harish paid 40%immediately by banker's cheque

Answer 1

Answer:

Trade discount is deducted from sale price purchase price as the case may be and there will be no entry for trade discount.

Harish A/C Dr 42,750

Discount A/C Dr 2,250

To Sales A/C 45,000

Bank A/C Dr 40% of 42,750

To Harish A/C