accounting entry

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 June 2011 Three parties X,Y AND Z
"X" sold goods to "y"worth Rs.80000. "X" has given discount to "Y" of Rs. 30000

In the books of "Z", "Y" has a debit balance of Rs.38000. He settles the same by paying Rs. 8000 and asks to adjust the discount of Rs.30000 received from "X"

"X" and "Z" have continuous running balance in each other's books.

will "X" be able to take credit of discount given in his books? if so please suggest the accounting entries

Ca Aashish Upadhyay

Ca Aashish Upadhyay (Expert)
Follow

02 June 2011 Dear Malika

I am not underatnding why a transaction between X and Y where X alllows some discount will any way affect the Books of Z. So i guess that you need to clarify more on this query

regds

aashish

Message likes : 1 times

amit

amit (Expert)
Follow

02 June 2011 In X's Books

1) Z's a/c Dr. 80,000
To Sales a/c 80,000

2) Discount a/c Dr. 30,000
To Y's a/c 30,000

In Y's Book

1) Cash a/c Dr. 8,000
X's a/c Dr.30,000
To Z's a/c 38,000

In Z's book

1) Y's a/c Dr. 38,000
To Cash a/c 8,000
To X's a/c 30,000

I hope this will clarify the matter otherwise feel free to ask.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

02 June 2011 dear aashish,

"Y" is common party in both the books of "X" and "Z"
Also, there exists inter transactions between "x" and "z".

Querist : Anonymous

Querist : Anonymous (Querist)

02 June 2011 dear amit,

"Y" is debtor in the books of "z"
also please tell enteries for mutal set off in the books of "x" and "z"

Pankaj Gandhi Jaiswal

Pankaj Gandhi Jaiswal (Expert)
Follow

05 June 2011 No any transactional relation is being established for discount between X & Y. The discount may be in the nature of sales discount. And how X can transfer his discount/bad debts to Y..it is prima facie seems not practicable

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now