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Question
Total creditors amounted to ₹ 5,00,000. Investments valued ₹ 2,00,000 were not shown in the books. One of the creditors took over these investments in full satisfaction of his debt of ₹ 2,20,000. Remaining creditors were paid at 5% discount. Pass entry for payment.
Journal Entry
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Solution
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
| Realisation A/c ...Dr. | 2,66,000 | - | ||
| To Cash/Bank A/c | - | 2,66,000 | ||
| (Being assets realized in cash amounting to ₹ 2,66,000 transferred to Bank A/c.) |
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