Question No 17 Chapter No 8 – T.S. Grewal 11 Class

Question No. 17 - Chapter No.8 - T.S. Grewal +1 Book 2019

Question No 17 Chapter No 8

M/s Vaish Trader, Delhi purchased 500 Parker Pens @ Rs 200 each less trade Discount @ 15% from luxor Pens Ltd., Delhi. CGST and SGST was levied @ 6% each. Further, Cash discount was allowed @5% as the payment was made within specific time. What will be the amount of trade discount and cash discount?

Solution: – 

Gross Purchase Price = 500*200
= 1,00,000/-

Trade Discount = Purchase Price * % of discount
= 1,00,000 * 15%
= 15,000/-

Net Purchase Price = Gross Purchase Price – Discount
= 1,00,000 – 15,000
= 85,000/-

Amount of CGST = Net Purchase Price * % of CGST
= 85,000* 6%
= 5,100/-

Amount of SGST = Net Purchase Price * % of SGST
= 85,000* 6%
= 5,100/-

Invoice Value = Net Purchase Price + CGST + SGST
= 85,000 + 5,100 + 5,100
= 95,200/-

Cash Discount = Invoice Value * % of Discount
= 95,200 * 5%
= 4,760/-

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 M/s Vaish Trader, Delhi

Date   Particulars
L.F. Debit Credit
  Purchase A/c Dr.   85,000  
  CGST Input A/c Dr.   5,100  
  SGST Input A/c Dr.   5,100  
             To Luxor Pens Ltd. A/c     95,200
  (Being goods purchased from M/s Luxor Pens Ltd. )      
         
  M/s Luxor Pens Ltd A/c Dr.   95,200  
            To Cash  A/c       90,440
            To Discount Received A/c       4,760
  (Being payment made to M/s Luxor Pens Ltd. 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

Transaction No. 1 Question No.17 Chapter No.8 T.S. Grewal 1 Book 2019 - Question No 17 Chapter No 8 - T.S. Grewal 11 Class
Transaction No. 1 Question No.17 – Chapter No.8 – T.S. Grewal +1 Book 2019
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 Luxor Pens Ltd.  A/Person   Personal Account  Goods given They are Giver Credit

Transaction No. 2

Transaction No. 2 Question No.17 Chapter No.8 T.S. Grewal 1 Book 2019 - Question No 17 Chapter No 8 - T.S. Grewal 11 Class
Transaction No. 2 Question No.17 – Chapter No.8 – T.S. Grewal +1 Book 2019
Name of Account Type of Account Rule which will Applicable What happen in the transaction Rule applied According to Rule It will be
Luxor Pens Ltd. 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

Thanks Please share with your friends  

Comment if you have any question.

Check out T.S. Grewal +1 Book 2019 ir?t=tutorstips 21&l=ur2&o=31 - Question No 17 Chapter No 8 - T.S. Grewal 11 Class@ Amazon.in

T.S. Grewals Double Entry Book Keeping - Question No 17 Chapter No 8 - T.S. Grewal 11 Class

T.S. Grewal’s Double Entry Book Keeping

 

3 thoughts on “Question No 17 Chapter No 8 – T.S. Grewal 11 Class”

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.