What will be the journal entry ??

At the time of advance:

Bank A/C Dr. 5,000

Sumit (or Advances from Sumit) Cr. 5,000

At the time of supply of goods:

Sumit Dr. 30,000

Sales Cr. 30,000

liability shows all credit balance ,

ex:

bank a/c dr. xx

 to loan a/c  cr. xx

under liability side :

loan xx...........

so with that

Assest shows debit balance coz " debit all expenses and loses " Nominal account

Liability shows credit balance coz " credit all income and gain " + if __ like is a liability then it comes cr. side

loan is liability/responsibility

whereas " Advance amount " extra  amount received is not our assest / we are not the owner of it so it is our responsibility to give it back to him , so advance comes under liability side

Originally posted by : @ !.$.P.
	1. Cash/ bank a/c dr 5k           To sumit adv a/c 5k 2. Sumit adv a/c Dr 5k     sumit drs a/c Dr 25k              To sales a/c 30k

Completely agree

 

First of all Agreeing to all of above experts' comments,

I wanna say,

I f You want detailed entry, ther ought to be following accounts opened

1. Bank A/c or Cash A/c

2. Advance from Sumit A/c - Under Current Liab.

3. Sumit A/c - Under S. Debtors

4. Sales or Goods A/c.

Journal Entries will be,

1. Bank/Cash A/c ....Dr. Rs.5000/-

                 TO Advance from Sumit A/c ...Rs.5000/-

2. Sumit's A/c ....Dr. Rs.30000/-

                     TO Sales/Goods A/c.....Rs.30000/-

3. Advance from Sumit A/c ... Dr. Rs.5000/-

                        TO Sumit A/c......................Rs.5000/-

(Being Adv. Recd from sumit Adjusted against His dues)

...PS- Correct me if Im wrong...

you are right shikha :)