Question

Trade Discount and Cash Discount
HIA. Pass necessary Journal entries for the following transactions in the books of Mahesh
(1) Mahesh started business with * 25,000.
(2) He ordered his supplier, Satish to send 5,000 worth of goods
(3) Purchased at 10% trade discount goods from A, the list price being 5,000
(4) Sold goods at 5% trade discount to Harihar, the list price being 2,000
(5) Goods purchased from M/s Neel Kamal at a list price of 12,000 at 10% trade discount and
3% cash discount. Cash was paid upto 80% of the amount
(6) Sold to S. Chauhan a trade discount of 6% and cash discount of 1% goods of the list price
of 15,000. He has paid 60% in cash.
Ans. Total of Journal 56,3001
nections​

Answer 1

Explanation:

cash a/C..........,........ DR. 25000

TO CAPITAL A/C. 25000

(Being business started)

purchase A/C ..............DR. 5000

to Satish A/C. 5000

(Being goods purchased from satish)

purchased A/C.............DR. 4500

to A's A/C. 4500

(Being goods purchased from A)

Harihar A/C ...................DR. 1900

to Sales A/C. 1900

(Being goods sold to harihar)

Purchase A/C.................DR. 10800

to Discount A/C. 324

to Cash A/C. 8381

to Neel Kamal A/C. 2095

(Being purchased from Neel Kamal)

S. Chauhan A/C..............DR. 5584

Discount A/C....................DR. 141

Cash A/C............................DR. 8375

TO SALE A/C 14100