Pass a journal entry in each of the following cases: (i) A running business was purchased by Mohan with following assets and liabilities: Cash Rs. ...

Question

Pass a journal entry in each of the following cases: (i) A running business was purchased by Mohan with following assets and liabilities: Cash Rs. 20,000, Land Rs. 40,000, Furniture Rs. 10,000, Stock Rs. 20,000, Creditors Rs. 10,000, Bank Overdraft Rs. 20,000. (ii) Sold goods to Gagandeep for RS. 1,00,000 at trade discount of 20% and charged IGST @12% (iii) Goods distributed by way of free samples Rs. 10,000. (iv) Goods of list price Rs. 40,000 returned by Gagandeep. (v) Kuldeep became an insolvent and could pay only 50 paise in a rupee. Amount due from him Rs. 6,000. [RTP Jan. 2025]

Accepted Answer

Option : Correct Option. Solution: Particulars L.F. Amount (Dr.) Amount (Cr.) Cash A/c Dr. Land A/c Dr. Furniture A/c Dr. Stock A/c Dr. To Creditors A/c To Bank Overdraft A/c To Capital A/c (Being commencement of business by Mohan by taking over a running business) 20,000 40,000 10,000 20,000 - - - - - - - 10,000 20,000 60,000 Gagandeep’s A/c Dr. To Sales A/c To Output GST A/c (Being goods sold to Gagandeep at trade discount of 20% and charged IGST @ 12%) 89,600 - - - 80,000 9,600 Advertisement Expenses A/c Dr. To Purchases A/ c (Being goods distributed as free sample) 10,000 - - 10,000 Sales Return A/ c Dr. Output IGST A/c Dr. To Gagandeep Al c (Being goods returned by Gagandeep and output IGST charged at the time of sales now reversed) 32,000 3,840 - - - 35,840 Cash A/c Dr. Bad Debts A/c Dr. To Kuldeep A/c 3,000 3,000 - - - 6,000 (Being Kuldeep become insolvent)

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