Journal Entry for Income Tax Last Updated : 21 Apr, 2025 Comments Improve Suggest changes Like Article Like Report Income Tax is paid by the business on the profit earned during the year. Income Tax is a personal liability of the proprietor. The journal entry will be:A. Payment of Income Tax:Journal Entry: B. Refund of Income Tax:Journal Entry: Example: Income Tax paid ₹1,500.Refund of Income Tax received ₹500.Solution: Comment More infoAdvertise with us S sukantkumar Follow Improve Article Tags : Accountancy Commerce Similar Reads Journal Entry for Depreciation Depreciation is the decrease in the value of assets due to use or normal wear and tear. Journal Entry:  Example: Depreciation charged on machinery ₹5,000.Solution:  Example: Machinery purchased for ₹20,000.Depreciation charged on machinery @10%.Solution: 1 min read Journal Entry for Discount Allowed and Received A discount is a concession in the selling price of a product offered by a seller to its customers. According to nature, there are two types of discount:A. Discount AllowedB. Discount ReceivedA. Discount Allowed: When at the time of sales or receiving cash, any concession is given to the customers, i 2 min read Journal Entry for Full/Final Settlement A business may allow or receive a discount at the time of full and final settlement of the accounts of debtors or creditors. Journal Entry:  Example:01 April 2022: Purchased goods from Sayeba at the list price of ₹10,000 at a 10% Trade Discount.05 April 2022: Returned goods to Sayeba for the list pr 1 min read Compound Journal Entry: Format, Examples & Advantages What is a Compound Journal Entry?A compound journal entry is a type of accounting entry that involves more than two accounts. Sometimes, two or more transactions relating to one particular account take place on the same date. When certain transactions of the same nature happen on the same date, it i 2 min read Opening Journal Entry After closing all the books at the end of a financial year, every business starts its new books at the beginning of each year. Closing balances of all the accounts are carried forward to the new year as opening balances. As it is the first entry in the new financial year, it is called Opening Journa 1 min read Journal Entry for Bad Debts and Bad Debts Recovered Bad Debts:When the goods are sold to customers on credit, there can be a situation where a few of them fail to pay the amount due to them because of insolvency or any other reason, and then the amount that remains unrecovered is called Bad Debts.Journal Entry: Example: Amount due from Gaurav ₹5,000 1 min read Journal Entry for Loss of Insured Goods/Assets Sometimes insured goods are lost by fire, theft, or any other reason. There can be three cases related to the loss of insured goods or assets.A. Claim does not get accepted by the Insurance Company: Journal Entry:  Example: Goods lost by fire ₹50,000. Insurance co. does not accept the claim.Assets l 1 min read Journal Entry for Loan Taken A business can take an amount of money as a loan from a bank or outsider. In return, the business has to pay interest. A. Loan is taken from a bank or person:Journal Entry:  Example: ₹10,000 was taken as a loan from the bank.Solution:  B. Interest charged by the bank or person and then paid: There c 1 min read Journal Entry for Loan Given Businesses can also provide loans to any person or entity.A. Loan is given to a person:Journal Entry:  Example: A loan of ₹5,000 has been provided to Dharmesh.Solution:  B. Interest charged and then received on loan given:There can be a situation where the interest is charged first and then received 1 min read Journal Entry for Outstanding Expenses Outstanding expenses are those expenses that are related to the same accounting period in which accounts are being made but are not yet paid.Journal Entry:  Example 1: Salaries due to employees ₹11,000.Solution: Example 2: Rent due to landlord ₹20,000.Solution: 1 min read Like