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Question No 16 Chapter No 8 – T.S. Grewal 11 Class

Question No. 16 - Chapter No.8 - T.S. Grewal +1 Book 2019
Question No. 16 - Chapter No.8 - T.S. Grewal +1 Book 2019

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Question No 16 Chapter No 8

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M/s Auto Aid, Delhi purchased 500 pieces of car horns @ Rs 200 each less 10% Trade discount plus IGST @ 12% from M/s Auto Horns, Chandigarh. What is the Invoice value?

Solution: – 

Working Note: –

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We will use the following formulas

  1. Invoice Price = Net Sale Price + GST 
  2. Net Sale Price = Gross Sale Price – Trade Discount

Gross Sale Price = 500*200
                              = 1,00,000

Net Sale Price = 1,00,000 – (1,00,000 * 10%)
= 1,00,000 – 10,000
= 90,000/-

Invoice Price = 90,000 + (90,000 * 12%)
= 90,000 + 10,800
= 1,00,800/-

In the Books of M/s Auto Aid, Delhi

Date  Particulars
L.F.DebitCredit
 Purchase A/cDr. 90,000 
 IGST input A/cDr. 10,800 
            To M/s Auto Horns A/c  1,00,800
 (Being goods purchased from M/s Auto Horns )   
     

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

Transaction No. 1 Question No.16 - Chapter No.8 - T.S. Grewal +1 Book 2019
Transaction No. 1 Question No.16 – Chapter No.8 – T.S. Grewal +1 Book 2019
Name of AccountType of AccountRule which will ApplicableWhat happen in the transactionRule appliedAccording to Rule It will be
Purchase (Goods)  Assets  Real Account  Goods received by businessGoods comes in Debit
CGST Input A/c ExpensesNominal AccountTax collected from buyer All Expenses and lossesDebit 
SGST Input A/c ExpensesNominal AccountTax collected from buyer All Expenses and lossesDebit 
M/s Auto Horns A/Person  Personal Account Goods givenThey are GiverCredit

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