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TRANSACTIONS
LECTURE 2
or Decrease)
Income/Expenses/Assets/Liabilities/Equity
2. Indentify the Balancing Double Entry (Mul-Mantra)
RECORDING SALES/INCOME
Recognised only when Sales has occurred i.e. Risk and Rewards has been
transferred
Sales is money earned by the company for itself and it excludes VAT, Principal
Amount when working on commission basis etc.
DR CASH OR DEBTORS
CR SALES VAT OR OURPUT VAT
CR SALES
Note Trade Discount is not generally accounted for and if accounted netted off
against Sales
SETTLEMENT DISCOUNT GIVEN
DR CASH RECEIVED (AFTER DISCOUNT)
DR Discount Given (Loss to the Company)
CR Debtors / Receivables Account (Original Amount as its fully settled)
RECORDING OTHER INCOME
DR Cash/Receivables
CR Interest/Rent/Dividends etc.
Payroll Tax
deducting Taxes)
When Employee Tax is Paid to Tax Department
Dr Employee Tax Account (Reverses the
Credit)
Cr Cash/Bank
Week 2 Assignment
Posting of the Transactions