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Question

Answer in one sentence only.
Which account will be debited when goods are sold to Ram on credit?

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Solution

In the transaction, "Goods sold to Ram on credit", two accounts are affected viz. personal account i.e., Ram a/c, and a real account i.e., Sales a/c.
As per the golden rule of accounting for personal account - "Debit the receiver and Credit the giver", and for real account - "Debit what comes in and Credit what goes out", Ram A/c will be debited for the given transaction.

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