Answer / vijay kumar

purchases A/c Dr. 5000/-

To Credit to party 4000/-
To Discount, 1000/-

discount head create in Indirect Income head,

Answer / jubeda

PURCHASES A/C DR. XXX
TO PARTY,S A/C XXX
TO DISCOUNT A/C XXX

Answer / surekha

the first entry is wrong .
discount normally offered by creditor as part of the po
terms so an entry is required for recognising the discount
so entry 2 is ok
purchases A/c Dr. 5000/-

To Credit to party 4000/-
To Discount, 1000/-

discount head create in Indirect Income head,

Answer / jubeda

PURCHASES A/C DR. XXX
TO PARTY,S A/C XXX
TO DISCOUNT A/C XXX

Answer / h.r. sreepada bhagi

It's important to know when the discount is given. Various
entries given below with example Original Price, Rs, 10000/-
& discount 10%.

1. When discount is mentioned in the Sales Invoice, there is
no need to recognise it separately as income (Discount
Received) as it is Trade Discount. The purchase entry is:-

Purchase A/c Dr. Rs.9000/-
Supplier's (Creditor) A/c Cr. Rs.9000/-

*** If it's an asset, Asset A/c shall be debited instead of
Purchases A/c.

However, if the discount of Rs. 1000/- is given at the time
of payment, then it's recognised as an Income, as it's
treated as Cash Discount. The purchase entry is:-

Purchase A/c Dr. Rs.10000/-
Supplier's (Creditor) A/c Cr. Rs.10000/-

The payment entry for settlement of credit purchase is :-

Supplier's (Creditor) A/c Dr. Rs.10000/-
Bank/Cash A/c Cr. Rs.9000/-
Discount Received A/c Cr. Rs.1000/-

Alternatively the supplier can be debited with Rs. 9000/-
through purchase entry & discount can be accounted by
debiting the supplier and crediting the Income A/c with Rs.
1000/-

Answer / babita sharma

Purchase A/c Dr. 5000
To Party name Cr. 4000
To Discount Received Cr. 1000
Discount head creat indirect income head.

Answer / mohd. irfan

Purchase A/c Dr. xxx
TO Party name. cr.xxx
To Discount Received Cr.xxx

Answer / barodianbuddy(acca)

PURCHASE DR XX
DISCOUNT RECEIVED CR XX
PAYABLE S CR XX

Answer / kaushal

Purchase A/c Dr.
To Creditor A/c

There are no discount entry made on credit purchases.
Because discount allowed only on cash transactions

What is mutual fund sub accounting?

0 Answers  

What do you mean by the word Loss in nominal accounting Give some examples

2 Answers  

How we can transfer stock from our punjab firm to our chandigarh firm

2 Answers   Infosys,

In accounting, vat abbreviates what?

0 Answers  

Tell me what happens to company's “cash account” if it borrows money from the bank by signing a note payable?

0 Answers  

which assets may have credit balance ?

3 Answers  

What is 'Rights Issue' ?

6 Answers  

my brother is out of country i have lost his bank passbook when i was going to bank for the entries is their essential to take duplicate pass book can my brother is present for this.

0 Answers  

What is the type of principal for CLOSING STOCK. and why we show closing stock two time that is once in trading account and another time in assets. if closing stock is Real account than what about showing in trading account as we dont show real account type in trading account. thanks

6 Answers   DuPont,

What is the basic accounting equation?

0 Answers  

As you know any other accounting application?

0 Answers  

difference between provisions and reserves

6 Answers   Capital IQ,