A company sells goods on hire-purchase on the basis of 25% down, the balance, with 20% interest
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A company sells goods on hire-purchase on the basis of 25% down, the balance, with 20% interest thereon being payable in 8 equal quarterly instalments on 31st March, 30th June, 30th September and 31st December each year. The first instalment is payable at the end of the quarter in which the sale is made. The company transfers 50%, 30% and 20% of the interest to the Profit and Loss Account in the first , second and third years respectively.(1) Hire-Purchase Debtors Account.
(2) Hire-Purchase Interest Suspense Account and prove the opening and closing balances of the latter account.
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Related Book For
Financial Accounting Volume II
ISBN: 9789387886230
4th Edition
Authors: Mohamed Hanif, Amitabha Mukherjee
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