Question

What is journal entry of bought laptop in exchange of good and goods were given at trade discount h?

Answer 1

Answer:

Computer a/c dr

To cash a/c

Computer is debited because asset is coming in business

Cash goes out so credited

When computer is for resale and sold

Cash a/c dr

To computer a/c

Cash comes in so debited

Computer goes out so credited

Profit and loss on sale is to be recorded if there is a loss it is to be debited if profit it has to be credited

But if someone’s business is selling computers so the word ‘computer’ in the journal entry above will be replaced by purchases and sales respectively. Because the items in which the business deals(regular purchase and sale) are goods for business.