Question

Mittal Cycles purchased 100 cycles from Hero Cycles, Ludhina (Punjab) @ ₹ 1,200 per cycle plus IGST @ 12%. Hero Cycles allowed 10% Trade Discount and 3% Cash Discount if payment is made within 14 days. Mittal Cycles received 10 cycles damaged during transit, which it returned. Mittal Cycles settled the payment in 10 days time.
​Pass Journal entries for the above transactions.

Answer 1

Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
	Purchases A/c	Dr.		1,08,000
	Input IGST A/c	Dr.		12,960
	To Hero Cycles A/c				1,20,960
	(Goods purchased @ 10% trade discount)
	Hero Cycles A/c	Dr.		12,096
	To Purchases Return A/c				10,800
	To Input IGST A/c				1,296
	(Returned 10 cycles)
	Hero Cycles A/c	Dr.		1,08,864
	To Cash A/c				1,05,598
	To Discount Received A/c				3,266
	(Balance paid and received cash discount of 3%)