Kanchan Sold 40 air conditioners to XYZ Ltd. @ Rs. 25,000 each less 25% trade discount and 2% cash discount if payment is made within 15 day. XYZ Ltd paid the amount within 14 days. What will be the amount the Kanchan should credit to the sales account?

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Solution

Note: Cash discount allowed is an expense and is debited to discount allowed account.

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