What should be the journal entry for this transaction?
Sold goods for 40000 to Anil at a profit of 20% on sales less 20% trade discount and charged 8% sales tax and paid cartage Rs.100 (to be charged from customer)
5 Replies
B.SEKAR
(manager-accts.)
(61 Points)
Replied 24 June 2013
dear dimple, you have not mentioned that the amount shown as sales Rs.40000, is only after charging s.tax, trade discount or not. It should be shown in the bill itself. reply for this and I will tell you the JV sekar
B.SEKAR
(manager-accts.)
(61 Points)
Replied 25 June 2013
Dear friend, we assume you are selling to Mr.A. on credit basis. You should add profit rs.8000/- with cost rs.40000/- and allow trade discount rs.8000/-(20% on sales) that comes about rs.40000/- balance and 8% sales tax for 40000/- comes about rs.3200/- then total is Rs.43200/-.
The JV is: DR CR
Mr.A's a/c 43200-00
Discount allowed 8000-00
Sales a/c 48000-00
8% sales tax a/c 3200-00
(Being sales made to Mr.A on credit).
I hope it is clear. If you any doubt mail to me : machenggco @ bsnl.in.
B.SEKAR
Dimple
(.)
(252 Points)
Replied 25 June 2013
Thank you so much but what shall be the treatment of cartage expenses?
B.SEKAR
(manager-accts.)
(61 Points)
Replied 26 June 2013
Sorry sir, if you add the cartage in the bill itself, then party's a/c will be increased by rs.100/- for cartage and packing and forwarding a/c will be credited for rs.100/- ok. if you want any clarification feel free to contact mobile 9445145480 or mail chith1954 @ gmail.com hereafterwards. thank you. sekar.
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