Question

Answer the question.
What is compound Journal Entry? Give an example.

Answer 1

A Compound Journal Entry is one in which two or more accounts are credited or vice-versa. For example, a debit of Rs. 4000 due from Ramesh has been discharged by receipt of only Rs. 3850 cash and by Rs. 150 allowed as discount.
The entry for the transaction is a compound entry as follows:

Cash A/c(Dr.)	Rs. Rs. 3850
Discount allowed A/c(Dr.)	150
To Ramesh	4000