passwella.
Menu

JAMB Principles of Accounts 2008 Question 11

Question 11

Cash Book

Abba offered 5% cash discount on goods worth N 10 000. The discount allowed account is to be

  1. A.debited with N 10 000
  2. B.credited with N 10 000
  3. C.debited with N 500
  4. D.credited with N 500
Show the answer and explanation

Answer: C (debited with N 500)

Explanation

Discount = 5% × 10 000 = ₦500. Discount allowed is an expense, so it is debited.