Question No 26 Chapter No 8 – T.S. Grewal 11 Class

Question No. 26 - Chapter No.8 - T.S. Grewal +1 Book 2019

Question No 26 Chapter No 8

Oswal Woollen Mills, Amritsar(Punjab) sold shawls to Gupta Shawls, Jaipur as per details: Sold 100 shawls @ Rs 200 per shawl on 4th January, 2018, IGST is levied @ 12%. Trade Discount 25% and Cash Discount 5% if full payment is made within 14 days. Gupta Shawls sent 50% of the payment on 14th January, 2018 and balance payment on 10th February, 2018. Pass Journal entries.

Solution of Question No 26 Chapter No 8: – 

Gross Sale Price = 100 * 200

= 20,000/-

Tarde Discount = Sale Price * % of discount
= 20,000 * 25%
= 5,000/-

Net Sale Price = Gross Sale Price – Discount
= 20,000 – 5,000
= 15,000/-

Amount of IGST = Net Sale Price * % of IGST
= 15,000 * 12%
= 1,800/-

Invoice Value = Net Purchase Price + IGST
= 15,000 + 1,800
= 16,800/-

In this question, Gupta Shawls, Jaipur cannot avail cash discount because there is a condition in the question for availing cash discount which Gupta Shawls, Jaipur did not fulfil. This condition is shown below:

Cash Discount 5% if full payment is made within 14 days.

But, Gupta Shawls  Jaipur paid only 50% amount within 14Days.

In the Books of M/s Oswal Woollen Mills, Amritsar(Punjab)

Date   Particulars
L.F. Debit Credit
2018          
4 Jan Gupta Shawls, Jaipur A/c Dr.   16,800  
             To Sales A/c     15,000
             To Output IGST A/c     1,800
  (Being goods sold to Gupta Shawls, Jaipur )      
         
14 Jan Cash A/c Dr.   8,400  
            To Gupta Shawls, Jaipur A/c       8,400
  (Being 50% of due payment received from Gupta Shawls, Jaipur)      
         
10 Feb Cash A/c Dr.   8,400  
            To Gupta Shawls, Jaipur A/c       8,400
  (Being balance of due payment received from Gupta Shawls, Jaipur)      
         

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.26 Chapter No.8 T.S. Grewal 1 Book 2019 - Question No 26 Chapter No 8 - T.S. Grewal 11 Class
Transaction No. 1 Question No.26 – 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
Gupta Shawls, Jaipur Person   Personal Account  Goods received  The firm is  receiver Debit
Sales a/c (Goods)   Assets   Real Account   Goods giving by Business Goods Goes out Credit 
Output IGST A/c  Income Nominal Account Tax collected from buyer  All income and gains  Credit 

Transaction No. 2

Transaction No. 2 Question No.26 Chapter No.8 T.S. Grewal 1 Book 2019 - Question No 26 Chapter No 8 - T.S. Grewal 11 Class
Transaction No. 2 Question No.26 – 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
Cash Assets   Real Account  Cash comes in  Comes in  Debit
Gupta Shawls, Jaipur Person   Personal Account  Making payment  The firm is  giver Credit 

Transaction No. 3

Transaction No. 3 Question No.26 Chapter No.8 T.S. Grewal 1 Book 2019 - Question No 26 Chapter No 8 - T.S. Grewal 11 Class
Transaction No. 3 Question No.26 – 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
Cash Assets   Real Account  Cash comes in  Comes in  Debit
Gupta Shawls, Jaipur Person   Personal Account  Making payment  The Firm is  giver Credit 

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