Question

Vasu sold goods to jothi for rs.25,000 against a cheque and deposited same into the bank journal

Answer 1

Given"Vasu sold goods to jothi for rs.25,000 against a cheque and deposited same into the bank journal"

Vasu sold goods to jothi for rs.25,000 against a cheque and deposited it in bank.

This transaction affects two accounts... Sales account (Goods are sold)..Bank(Cheque recieved and deposited into bank on the same day)

Sales account is a nominal account ( sales is an income; all losses Gains income expenses come under nominal account)

Bank account is a real account ( bank balance is an asset; all assets and Liabilities come under Real account)


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

In contention with the above rules...

Sales should be credited (its an income)

Bank account should be debited (cash (bank balance) is comingin)

So the Journal Entry will be...

Bank a/c Dr 25000

To sales a/c 25000

(Being Goods Sold to jothi and received Cheque)