Question No 24 Chapter No 8 - T.S. Grewal 11 Class

Question No 24 Chapter No 8

Pass Journal entry for purchase of goods by Amrit, Delhi from Add Gel Pens, Delhi for Rs 15,000 less Trade Discount 10% and cash discount 3% CGST and SGST is levied @ 6% each. Assume payment is made at the time of purchase. 

Solution of Question No 24 Chapter No 8: - 

Working Note:

Gross Purchase Price = 15,000/-

Tarde Discount = Purchase Price * % of discount
= 15,000 * 10%
= 1,500/-

Net Purchase Price = Gross Purchase Price - Discount
= 15,000 – 1,500
= 13,500/-

Amount of CGST = Net Purchase Price * % of CGST
= 13,500* 6%
= 810/-

Amount of SGST = Net Purchase Price * % of SGST
= 13,500* 6%
= 810/-

Invoice Value = Net Purchase Price + CGST + SGST
= 13,500 + 810 + 810
= 15,120/-

Cash Discount = Invoice Value * % of Discount
= 15,120 * 3%
= 454/-

Cash discount always availed at the time of payment and trade discount is availed at the time of dealing/trading/ Negotiation. So, in this question, we can avail cash discount when payment is made within a specific time limit.

In the Books of Amrit, Delhi

Date	Particulars		L.F.	Debit	Credit
	Purchase A/c	Dr.		13,500
	CGST Input A/c	Dr.		810
	SGST Input A/c	Dr.		810
	To Add Gel Pens, Delhi A/c				15,120
	(Being goods purchased from M/s Add Gel Pens, Delhi )
	Add Gel Pens, Delhi A/c	Dr.		15,120
	To Cash  A/c				14666
	To Discount Received A/c				454
	(Being payment made to M/s Add Gel Pens, Delhi and receive discount)

Explanation of All Transactions with images:-

This is not a part of the solution, So you don't have to write it in the exam. So, why we explained if it is not needed. Because This explanation will help you to understand all transactions with logic and you don't need to remember all the transactions but just understand and remember the logic use behind it.

Transaction No. 1

Name of Account	Type of Account	Rule which will Applicable	What happen in the transaction	Rule applied	According to Rule It will be
Purchase (Goods)	Assets	Real Account	Goods received by business	Goods comes in	Debit
CGST Input A/c	Expenses	Nominal Account	Tax collected from buyer	All Expenses and losses	Debit
SGST Input A/c	Expenses	Nominal Account	Tax collected from buyer	All Expenses and losses	Debit
M/s Add Gel Pens, Delhi	A/Person	Personal Account	Goods given	They are Giver	Credit

Transaction No. 2

Name of Account	Type of Account	Rule which will Applicable	What happen in the transaction	Rule applied	According to Rule It will be
M/s Add Gel Pens, Delhi	A/Person	Personal Account	Receiving  payment	They are Receiver	Debit
Cash	Assets	Real Account	Payment made in cash	Cash goes out	Credit
Discount Received	gain	Nominal Account	Discount received	All income and gains	Credit

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