Journal Entry for Sale of Goods and Return of Goods

Journal Entry for Sale of Goods:
When goods are sold to a customer, it is important to record the transaction in the books of accounts. The journal entry for the sale of goods is as follows:

Date | Account | Debit | Credit
--- | --- | --- | ---
Date of Sale | Mohan's Account | - | ₹18,000
| Sales Account | ₹18,000 | -

Explanation:
- Mohan's Account is debited with the amount of ₹18,000, which is the selling price of the goods after deducting the trade discount of 10% (₹2,000).
- Sales Account is credited with the same amount of ₹18,000.

Journal Entry for Return of Goods:
Sometimes, customers may return goods due to various reasons such as defects, dissatisfaction, or incorrect delivery. The journal entry for the return of goods is as follows:

Date | Account | Debit | Credit
--- | --- | --- | ---
Date of Return | Sales Return Account | ₹5,000 | -
| Mohan's Account | - | ₹5,000

Explanation:
- Sales Return Account is debited with the amount of ₹5,000, which is the list price of the returned goods.
- Mohan's Account is credited with the same amount of ₹5,000.

Ledger Accounts:
After recording the journal entries, the transactions are posted in the respective ledger accounts. The ledger accounts for Mohan's Account, Sales Account, and Sales Return Account will look like this:

Mohan's Account | |
--- | ---
Date | Particulars | Debit | Credit
| Balance b/d | - | -
| Date of Sale | Sales Account | - | ₹18,000
| Date of Return | Sales Return Account | ₹5,000 | -
| Balance c/d | ₹13,000 | -

Sales Account | |
--- | ---
Date | Particulars | Debit | Credit
| Date of Sale | Mohan's Account | - | ₹18,000
| Balance c/d | ₹18,000 | -

Sales Return Account | |
--- | ---
Date | Particulars | Debit | Credit
| Date of Return | Mohan's Account | - | ₹5,000
| Balance c/d | ₹5,000 | -

Trial Balance:
A trial balance is prepared to ensure that the total debits and credits are equal. The trial balance for this transaction will look like this:

Particulars | Debit | Credit
--- | --- | ---
Mohan's Account | ₹13,000 | -
Sales Account | - | ₹18,000
Sales Return Account | ₹5,000 | -
Total | ₹18,000 | ₹18,000

Conclusion:
In conclusion, the sale of goods and return of goods transactions are recorded in the books of accounts using journal entries, which are then posted in the respective ledger accounts. A trial balance is prepared to ensure the accuracy of the books of accounts.