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Question No 26 Chapter No 16 - Unimax Class 11
Following are the Extracts from the Trail Balance of a firm:
Trial Balance as at 31.3.2020
| Particulars | Debit | Credit | |
|---|---|---|---|
| Sundry creditors | 1,20,000 | ||
| Discount received | 4,000 | ||
| Reserve for discount on creditors | 7,600 | ||
Adjustment information:
((1) Additional discount received from creditors after closing the account ₹ 4,600.
(2) Create a reserve for discount on creditors @ 5%.
You are required to pass the necessary journal entries. Prepare reserve for discount on creditors A/c and show how the various items would appear in the final accounts.
Journal
| Date | Particulars |
Debit | Credit | ||||
|---|---|---|---|---|---|---|---|
| 31.3.2020 | Sundry creditors A/c | Dr. | 4,600 | ||||
| To Discount A/c | 4,600 | ||||||
| (Being additional discount received from sundry creditors) | |||||||
| 31.3.2020 | Discount A/c | Dr. | 8,600 | ||||
| To Reserve for discount on creditor A/c | 8,600 | ||||||
| (Being transfer of discount received account of its provision account) | |||||||
| 31.3.2020 | Reserve for Discount on creditors A/c | Dr. | 7,000 | ||||
| To Profit & Loss A/c | 7,000 | ||||||
| (Being created to Profit & Loss A/c for maintain a reserve for discount @ 5% on creditors) | |||||||
| Reserve for discount on creditors A/c |
||||
| Particulars |
Amount | Particulars | Amount | |
|---|---|---|---|---|
| To balance b/d | 7,600 | By Discount | 8,600 | |
| To P&L A/c | 7,000z | By Discount (5% 1,20,000) | 6,000 | |
| 14,600 | 14,600 | |||
| Profit & Loss A/c For the year ended 31st March,2020 |
|||||
| Particulars | Amount | Particulars | Amount | ||
|---|---|---|---|---|---|
| By Discount | 4,000 | ||||
| Add: Add. Discount | 4,600 | ||||
| 8,600 | |||||
| Add: New Discount | 6,000 | ||||
| 14,600 | |||||
| Less: Old Discount | 7,600 | 7,000 | |||
| Balance Sheet As at 31st March, 2020 |
|||||
| Liabilities | Amount | Assets | Amount | ||
|---|---|---|---|---|---|
| Sundry creditors | 1,20,000 | ||||
| Less: Reserve for discount on creditors | 6,000 | 1,14,000 | |||
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Also, Check out the solved question of all Chapters: –
Students may choose only one part from the Part II and Part III
Part-II
Part-III
Chapter No. 2 - Theory Base of Accounting
Chapter No. 3 - Origin of Transactions
Chapter No. 4 - Vouchers and transactions
Chapter No. 6 - Accounting for Goods and Services Tax(GST)
Chapter No. 9 - Other Subsidiary Books
Chapter No. 10 - Journal Proper
Chapter No. 11 - Trial Balance
Chapter No. 12 - Bank Reconciliation Statement
Chapter No. 14 - Provisions and Reserves
Chapter No. 15 - Bills of Exchange
Chapter No. 16 - Rectification of Errors
Chapter No. 17 - Financial Statements - (Without Adjustments)
Chapter No. 18 - Financial Statements - (With Adjustments)
Check out T.S. Grewal +1 Book 2019 @ Oficial Website of Sultan Chand Publication
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
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