IndigoLearn

Doubt

Sir in this point no.4 if I Dr. Naveen a/c instead of purchase account is it is wrong ?

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Sri kanaga Varshini

Sri kanaga Varshini

CA Inter

1K+

11-Nov-20 18:16

32

Answers (3)

Wrong Reasons: 1.By writing Naveen a/c he will become debtor but in given question it is said that cash payment was done since cash discount was given only in case of payment 2. Hence u can't debit Naveen A/C


Mr. Spoidy

Mr. Spoidy

CA Inter

195

11-Nov-20 18:41

Wrong Reasons: 1.By writing Naveen a/c he will become debtor but in given question it is said that cash payment was done since cash discount was given only in case of payment 2. Hence u can't debit Naveen A/C

It could be a credit purchase so earlier naveen would be in CR , now I am making payment so by Dr. Naveen I reduced liability.also now I am making payment so I received cash discount. My point of view is this... then how it will be wrong?


Sri kanaga Varshini

Sri kanaga Varshini

CA Inter

1K+

11-Nov-20 18:44

It could be a credit purchase so earlier naveen would be in CR , now I am making payment so by Dr. Naveen I reduced liability.also now I am making payment so I received cash discount. My point of view is this... then how it will be wrong?

If earlier recorded as creditor for that amount ur opinion is correct. But logically if trade discount and cash discount given simultaneously it's reasonable to assume that immediate payment was inneciated and paid accordingly


Mr. Spoidy

Mr. Spoidy

CA Inter

195

11-Nov-20 18:50