Question No 04 Chapter No 6

04. Pass entries for the following transactions in the books of M/s Karthikeyan & Co. of Chennai:

 2019 Jun.10 Purchased goods from Ravichandran of Madurai of the list price of 2,00,000 at 25% trade discount at 4% cash discount on the purchase price of goods. Paid CGST and SGST @ 9% each. Paid the entire amount by cheque on the same date. Jun.25 Sold goods to Ramalingam of Erode of the list price of 3,75,000 at 20% trade discount and 2% cash discount on sale price. Charged CGST and SGST @ 9% each. The full amount was received by cheque on the same date.

## The solution of Question No 04 Chapter No 6: –

 In the Books of Radhika Traders Date Particulars L.F. Debit Credit 2019 Jun.10 Purchases A/c Dr. 1,50,000 Input CGST A/c Dr. 13,500 Input SGST A/c Dr. 13,500 To Bank A/c 1,71,000 To Discount received A/c 6,000 (Being Purchased from Mehta Bros.) Jun.25 Bank A/c Dr. 3,48,000 Discount Allowed A/c Dr. 6,000 To Sale A/c . 3,48,000 To Output CGST A/c 27,000 To Output SGST A/c 27,000 (Being Purchased goods and paid by cheque) Mar.15 Advertisement A/c Dr. 40,000 Input CGST A/c Dr. 3,600 Input SGST A/c Dr. 3,600 To Cash A/c 47,200 (Being goods sold to Ramalingam @20)

Working Note: –

Calculation of the amount paid on purchases

 List price of goods purchased = 2,00,000 Less: trade discount @ 25% = 50,000 = 1,50,000 Add: Input CGST @ 9% 27,000 Add: Output SGST @ 9% 27,000 = 54,000 = 3,54,000 Less: Cash discount @ 2% = 6,000 Amount payable = 3,48,000

Calculation of the amount received on sales

 A list price of goods purchased = 3,75,000 Less: trade discount @ 20% = 75,000 = 3,00,000 Add: Input CGST @ 9% 13,500 Add: Output CGST @ 9% 13,500 = 27,000 = 1,77,000 Less: Cash discount @ 4% = 2,400 Amount payable = 1,71,000

How to make Journal Entries in Accounting – Explanation

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