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treatment of cash discount ,freight,scheme discount in purchase bill
What is Journal entry for stock item like freight , cash discount etc. which shows negative balance?
Replies (3)
Pls ellaborate your question, not able to understand your query....
I mean I recorded Purchase invoice in detail means all stock item and all discounts ..after recording purchase invoice when I saw stock summary then all discounts item shows negative balances..
If i undertsood correctly, your problem is, how to account cash discount received in purchase bill which is negative balance .
Very simple account the purchase net of discount
example
Item Rate discount Price
Item 1 100 10 90
Item 2 100 5 95
JV
Item 1(InventoryA/c) A/c Dr 90
Item 2 (Inventory A/c) A.c Dr 95
To Vendor A/c/ Bank A/c 185
I hope this answer your query
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