Question

the goodsof Rs 3400000/- was sold to raman on 28 the March .On 5th April he sold goods of amount RS 34560/ & the payment was made through cheque. He deposited the cheque on the same day in bank . There was a need of cash so on amount of RS 4550/- was withdrawn from bank on 10 April . on 10th April May Raman became insolvent so an amount of RS 60/- only can be received from him

Answer 1

Journal entry

1)  date : 28th march

Raman A/c  Dr    34,00,000

         To sales A/c                       34,00,000

(being goods sold on credit)

2)5Th april

Bank A/c   Dr    34560

     To  sales A/c                 34560

(being sold goods and deposited in bank on same day )

3) 10 th april

Cash A/c    Dr   4550

      To bank A/c             4550

(being withdrawn cash from bank)

4) 10Th  April

Raman A/c  Dr     34,00,000

      To cash A/c                            20,40,000

       To Bad debts A/c                  13,60,000

(being Raman become insolvent and can be recovered from him by only Rs 60paise )

* note : there is small mistake in question its Rs. 60Pasie only

So calculation.

received from cash = 3400000 * 60%

                                 = 20,40,000

Bad debts              = 3400000 *40%

                               = 1360000