Journal Entry for an Order of 40,000 with an Advance Given of 10,000

To record the financial transaction related to an order of 40,000 and an advance given of 10,000, the following journal entry needs to be made:

Step 1: Identify the Accounts Involved
In this transaction, we need to consider the following accounts:
1. Accounts Receivable (Order amount)
2. Cash (Advance given)

Step 2: Determine the Types of Accounts
Based on the accounts involved, we can classify them as follows:
1. Accounts Receivable is an asset account.
2. Cash is also an asset account.

Step 3: Analyze the Transaction
The company has received an order worth 40,000 from a customer. As a part of the order, an advance payment of 10,000 has been made by the customer.

Step 4: Record the Journal Entry
To record this transaction, we will use the double-entry bookkeeping system. Each entry will have a debit and a corresponding credit.

The journal entry can be recorded as follows:

Date: [Date of transaction]

Debit:
Accounts Receivable - 40,000
To record the order amount as an account receivable.

Credit:
Cash - 10,000
To record the advance payment received.

Credit:
Accounts Receivable - 30,000
To record the remaining amount of the order as a receivable.

Step 5: Explanation
The debit entry to Accounts Receivable reflects the increase in the amount owed to the company by the customer. It represents the account receivable for the total order amount of 40,000.

The credit entry to Cash shows the increase in the cash balance by 10,000 due to the advance payment received.

The second credit entry to Accounts Receivable represents the decrease in the account receivable balance by the amount of the advance payment. The remaining amount of the order, 30,000, is still owed by the customer.

Conclusion
By following the steps mentioned above, you can record the journal entry for an order of 40,000 with an advance given of 10,000. It is essential to have accurate and detailed financial records to ensure proper bookkeeping and financial management.

Cash a/c dr. 10000

to debtor a/c. 10000