01-05-2007, 01:50 AM
a) No entry is passed for sales made on approval basis, so if the sale has been recorded incorrectly, we shall reverse the entry
SALES 600
TO DEBTORS 600
b) Since the proprietor has taken out the goods, it will be considered as drawings. Entry will be
SALES 2500
TO DEBTORS 2500
DRAWINGS(N-1) 2000
TO PURCHASES 2000
N-1 COST OF SALES = 2500/100*80 = 2000
SALES 600
TO DEBTORS 600
b) Since the proprietor has taken out the goods, it will be considered as drawings. Entry will be
SALES 2500
TO DEBTORS 2500
DRAWINGS(N-1) 2000
TO PURCHASES 2000
N-1 COST OF SALES = 2500/100*80 = 2000
