Multiple choice

What is the correct journal entry for the transaction ''Sold goods worth Rs. 60,000 to Prem Traders plus 4% Value Added Tax (VAT)''?

  1. Dr. Prem Traders Rs. 62,400 & Cr. Sales a/c Rs. 62,400.

  2. Dr. Prem Traders Rs. 60,000 & Cr. Sales a/c Rs. 60,000.

  3. Dr. Prem Traders Rs. 60,000, Dr. VAT a/c Rs. 2,400 & Cr. Sales a/c Rs. 62,400.

  4. Dr. Prem Traders Rs. 62,400, Cr. VAT a/c Rs. 2,400 & Cr. Sales a/c Rs. 60,000.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Prem Traders is a debtor so debited & sales & VAT a/c credited.

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