Question

Pass journal entries for the following:

2019
Jan. 6		Purchased goods from Henry for ₹ 50,000 on 10% trade discount and 4% cash discount and paid 60% amount by cheque.
Jan. 15		Bought goods from Amit for ₹ 2,00,000 at terms 5% cash discount and 20% trade discount. Paid 3/4th of the amount in cash at the time of purchase.
Jan. 18		Sold goods to Sherpa at the list price of ₹ 50,000 less 20% trade discount and 4% cash discount if the payment is made within 7 days. 75% payment is received by cheque on Jan. 23rd.
Jan. 25		Sold goods to Garima for ₹ 1,00,000, allowed her 20% trade discount and 5% cash discount if the payment is made within 15 days. She paid 1/4th of the amount by cheque on Feb. 5th and 60% of the remainder on Feb.15th in cash

Answer 1

Journal In the Books of …
Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)
2019
Jan. 06	Purchases A/c	Dr.		45,000
	To Bank A/c (WN1)				25,920
	To Discount Received A/c				1,080
	To Henry’s A/c				18,000
	(Goods purchased and discount received on cash payment)
Jan. 15	Purchases A/c	Dr.		1,60,000
	To Bank A/c				1,14,000
	To Discount Received A/c				6,000
	To Amit’s A/c				40,000
	(Goods purchased and discount received on cash payment)
Jan. 18	Sherpa’s A/c	Dr.		40,000
	To Sales A/c				40,000
	(Goods sold to Sherpa on credit)
Jan. 23	Bank A/c	Dr.		28,800
	Discount Allowed A/c	Dr.		1,200
	To Sherpa’s A/c				30,000
	(75% payment received by Sherpa and allowed cash discount)
Jan. 25	Garima’s A/c	Dr.		80,000
	To Sales A/c				80,000
	(Goods sold to Garima on credit)
Feb. 05	Bank A/c	Dr.		19,000
	Discount Allowed A/c	Dr.		1,000
	To Garima’s A/c				20,000
	(Cheque received from Garima and allowed cash discount)
Feb. 15	Cash A/c*	Dr.		60,000
	To Garima’s A/c				60,000
	(Cash received from Garima)
	TOTAL			4,35,000	4,35,000

Working Notes:

WN1: Calculation of Payment made to Henry

WN2: Calculation of Payment made to Amit

*Note: Cash discount can be availed only if the payment is made within 15 days. Since payment is made on Feb. 15, thus, no discount is to be allowed to her.