Sales T Account In Accounting

Sales T Account is a standard form of a Ledger Account. It is prepared to record only Credit Sales Transactions transferred from Sales Journal

According to the Rules of Debit And Credit, the normal or usual balance (which is finally closed at the end of the accounting period to Income Statement Later on) is Credit, but when it decreases, we debit as in case of passing Closing Journal Entries.

Let’s us prepare Sales T Account with the help of an example.

Suppose, Mr. A is a sole proprietor. He deals in the Sales of clothes. On 1^st March, 2019, he sold 10 pieces of clothes each costing Rs. 5000 during the period of Rs. 50000 to his customer (Accounts Receivable), Mr. b. This creates Credit Sales in the Books of Accounts of business of Mr. A. Then, at first, this Transaction is journalized to Sales Journal and then posted to Sales Ledger Account as shown below:

                                               Mr. B  50000

                                                              Sales a/c  50000

                                    (Sold Goods Worth Rs. 50000 To Mr. b On Credit)

                                                              Sales T Account

                                                         Mr. A’s Business Name

                                                        For the Accounting Period

                            Rs.                                                                             Rs.

                                                                                     Mr. B              50000

On receiving the 10 pieces of clothes dated 10^th March, 2019, Mr. B found that 2 pieces of clothes are defective and one piece of cloth consists of poor quality. He returned the 3 pieces of clothes to Mr. A, but Mr. A offers the Mr. B to retain one piece that is of poor quality at 2% Sales Allowance. Then the combined journal entry for Sales Returns and Sales Allowance is shown below:

                                      Sales Returns a/c  10000

                                      Sales Allowance a/c  100 

                                                                          Mr. B  10100

   (2 Pieces of Clothes Returned While One Piece Is Retained at 2% Allowance)

Here Sales Returns = (2 X 5000) = Rs. 10000

Sales Allowance = 5000 X 2%    = Rs. 100

These Journal Entries are posted to Sales Return and Sales Allowance t-account and not shown in sales t account.