Journal Entry for Cash Sales

Journal Entry for Cash Sales

In this article we would be discussing the journal entry for cash sales. The following journal entry shall be recorded in the books of account for cash sales. The cash account would be debited being increase in asset and sales account would be credited being increase in income.

Date	Particular	Ledger Folio	Dr.	Cr.
	Cash		xxx
	Sales			xxx

Examples for Journal Entries for Cash Sales

1.    Cash Sales made of PKR. 100,000.

2.    Cash Sales made to Ali of PKR 250,000.

In first transaction the cash would be debited by 100,000 and sales income would be credited by 100,000.

Date	Particular	Ledger Folio	Dr.	Cr.
	Cash		100,000
	Sales			100,000

In second transaction the cash account shall be debited with an amount of 250,000 and sale income is credited with same amount under the dual concept of accounting. The other reason for crediting the sales account is an increase in the income.

Date	Particular	Ledger Folio	Dr.	Cr.
	Cash		250,000
	Sales			250,000

The following debit & credit rules for recording the journal have been applied to record the above cash sales transaction.

·         Increase in income is Credit.

·         Increase in asset is Debit.