WAEC Financial Accounting 2020 Question 30

Question 30

Cash Book

Use the following information to answer questions 29 to 31.
Kwamenah bought goods worth Le 50,000 from Doe and Sons Limited on the following terms: 3% trade discount; 10% cash discount. Kwamenah returned defective goods worth Le 8,000 the next day and made payment for the remaining goods on the due date.
Kwamenah would record the 10% discount in the

  1. A.sales journal.
  2. B.cash book.
  3. C.purchases journal.
  4. D.journal proper.
Show the answer and explanation

Answer: B (cash book.)

Explanation

Cash discount is recorded in the discount column of the cash book when payment is made.