b7 Cash Alc Dr. 17,100 Discount Alc Dr. 900 To Sales Alc 18,000 (For goods sold for cash less trade discount and cash discount allowed.) 4. Sales Tax: If the trader recovers the amount of sales tax along with the sales amount from the customer. The following entries are made: - (i) On sale: Cash Alc Dr. To Sales Alc To Sales Tax A/C (For Sold goods for cash and collected sales tax.) (ii) On deposit of sales tax to the Government: Sales Tax A/c Dr. To Cash Alc (For sales tax deposited to Government.) If the amount of sales tax has not been deposited to the government fund, then it is shown in the liability sid of the Balance sheet being the Representative Personal Account Illustration 13: Pass journal entries for the month of August 2016 in the books of Manish for the following transactions: 2016 August 1 Manish started business with cash 60,000, Furniture 10,000, Machinery 20,000 and Stock 35,000. August 2 Cash Purchases 35,000. August 4 Sold goods to Shyam of the list price of 20,000 at trade discount of 5% August 6 Goods purchased from Rajendra of 30,000 at 10% trade discount, August 9 Goods worth 3000 was distributed as free samples. August 11 Shyam returned goods worth 3000, August 14 Returned goods to Rajendra worth 4000. August 17 Withdrew cash 1000 and goods worth 3000 for personal use. August 18 Received from Shyam 15,500 in full settlement. August 21 Cash paid to Rajendra in full settlement*22,400. August 22 Sold goods to Pramod 15,000. August 24 Received an order for goods from Hiralal 10,000. August 25 Goods given away in charity 2000. August 26 Goods sold for cash to Pradeep for 5000 and collected 10% sales tax on it. August 27 Received commission 1500 August 29 Pramod was declared insolvent and received only 3000 from him. August 31 Paid rent3000 and salaries 7000