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Class 11-commerce NCERT Solutions Accountancy Part I Chapter 8 - Bills of Exchange

Bills of Exchange Exercise 310

Solution SA 1

Cheques and Bills of exchange are the commonly used negotiable instruments.

Solution SA 2

 

Bills of Exchange

Promissory Note

A bill of exchange is an instrument in writing containing an unconditional order, signed by the maker directing a certain person to pay a certain amount of money only to, or to the order of a certain person or to the bearer of the instrument.

A promissory note is an instrument in writing containing an unconditional undertaking signed by the maker to pay a certain sum of money only to, or to the order of a certain person or to the bearer of the instrument.

There are three parties involved, namely drawer, drawee and payee.

There are two parties involved, namely maker and payee.

 

Solution SA 3

Essential features of bills of exchange are as follows:

  1. A bill of exchange is a written order to make payment
  2. It is an unconditional order to make payment by a person i.e. drawee
  3. The amount of bill of exchange and the date of payment are certain
  4. It is signed by the drawer of the bill
  5. It is accepted by the drawee by signing on it
  6. The amount specified in the bill of exchange is payable either on demand or on the expiry of a fixed period
  7. The amount specified in the bill is payable either to a certain person or to his order or to the bearer of the bill
  8. It is stamped as per legal requirements

Solution SA 4

There are three parties in a bill of exchange:

  1. Drawer is the person who makes the bill of exchange. She/he is a person who has granted credit to the person on whom the bill of exchange is drawn. The drawer is entitled to receive money from the drawee (acceptor).
  2. Drawee is the person on whom the bill of exchange is drawn for acceptance and to whom credit has been granted by the drawer. He/she is liable to pay money to the creditor/drawer.
  3. Payee is the person who receives the payment from the drawee. Usually the drawer and the payee are the same person.

 

Solution SA 5

The date calculated after adding 3 days of grace to the due date of a bill is called the date of maturity of a bill. It is to be noted that when a bill is to be payable on demand/at sight, then days of grace is not applicable. When the period of a bill is mentioned in days, the maturity of bill is calculated in days. Similarly, when the period of a bill is mentioned in months, the maturity of bill is calculated in months. In certain cases, when the maturity date of any bill falls on a public holiday, then the maturity date of the bill will be the previous business day.

Solution SA 6

When the drawee of the bill fails to make the payment on the maturity date of the bill, then the bill is said to have been dishonoured. Hence, liability of the acceptor is restored. Entries made for recording dishonour of the bill of exchange are as follows:

In the books of drawer

Drawee's A/c

Dr.

          To Bills Receivable A/c

 

(Being bill dishonoured)

 

 

In the books of drawee

Bills Payable A/c

Dr.

         To Drawer's A/c

 

(Being bill dishonoured)

 

 

Solution SA 7

There are two parties to a promissory note:

  1. Maker- The person who makes the note and undertakes to pay the amount.
  2. Payee- The person who receives the payment.

Solution SA 8

A bill of exchange is a written instrument which contains an unconditional order directing a person to pay a certain amount on an agreed date. In other words, it is drawn by the creditor on her/his debtors to make a payment of a certain amount on the mentioned date. Such a bill comes into existence after the consent of both the parties. A bill cannot come into existence without the acceptance of a debtor. Hence, the debtor of the bill has to accept the terms of the bill, sign the same and make it a legal document.

Solution SA 9

When the drawee of the bill fails to make the payment on the maturity date of the bill, then the bill is said to have been dishonoured. To have a legal proof of the dishonour, the bill gets noted by the notary public who is approved by the central/state government. The notary public charges fees called the noting charges for noting and protesting the bill of exchange of its dishonour.

Solution SA 10

When the drawee does not have enough funds to make the payment, he may approach the drawer and ask for an extension of time for the payment. If the drawer agrees, then a new bill is drawn which is known as renewal of bill. The new bill may include interest for the extended period.

Solution SA 11

 

Serial Number of Bill

Date Received

Date of Bill

Received From Whom

Drawer

Acceptor

Where payable

Term

Due date

Ledger Folio

Amount

Cash Book Folio

Remarks

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Solution SA 12

 

Serial Number of Bill

Date of Bill

Given To Whom

Drawer

Payee

Payable Where

Term of Bill

Due Date

Ledger Folio

Amount Paid

Date

Cash Book Folio

Remarks

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Solution SA 13

When the drawee of the bill pays off the amount of the bill before the maturity of the bill it is called retirement of the bill. Holder of the bill may give discount for such earlier payment which is called as 'rebate'.

Entry in the books of the holder of the bill

 

Cash A/c

Dr.

Rebate A/c

Dr.

       To Bills Receivable A/c

 

(Being bill amount received before maturity and rebate allowed for retirement of the bill)

 

 

Entry in the books of the acceptor (drawee) of the bill

 

Bills Payable A/c

Dr.

      To Cash A/c

 

      To Rebate A/c

 

(Being bill paid and rebate received on retirement of the bill)

 

 

 

 

Solution SA 14

If the drawee wishes to pay the bill before the due date of the bill to the holder and the holder accepts such request, then due to the early payment, the holder may give some discount to the drawee. Such a discount is termed as rebate.

Solution SA 15

Performa of a Bill of exchange is given below.

  

 

Solution LA 1

According to Negotiable Instrument Act, 1981, "A bill of exchange is defined as an instrument in writing, containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument."

 

As the definition mentions the bill is an unconditional order to pay i.e. no conditions should be applicable with respect to the payment and the drawee of the bill is obliged to pay the maker of the bill. This is one of the main features of a bill of exchange. All the conditions with respect to the bill, for example; the amount, the date of payment, the parties involved needs to be specified with clarity.

Solution LA 2

On the maturity of the bill, when the acceptor of the bill fails to make the payment, it is said that the bill is dishonoured. This restores the liability of the acceptor.

Entry in the books of drawer:

Drawee A/c

Dr.

-----------To Bills Receivable A/c

 

(Being bill dishonoured)

 

 

Entry in the books of drawee:

Bills Payable A/c

Dr.

-----------To Drawer A/c

 

(Being bill dishonoured)

 

 

Noting charges is the fee paid to the notary public for noting and protesting the bill of exchange of its dishonour.

Effect of Noting charges in the books of the drawer:

Drawee A/c

Dr.

-----------To Bills Receivable A/c

 

-----------To Cash A/c (Noting charges)

 

(Being bill dishonoured and Noting charges paid)

 

 

In the books of drawee:

Bills Payable A/c

Dr.

Noting charges A/c

Dr.

-----------To Drawer A/c

 

(Being bill dishonoured and Noting charges due)

 

 

Solution LA 3

The procedure to calculate the date of maturity of a bill of exchange is given below.

  1. Determine the date on which the bill will be due.
  2. Add three days of grace to the due date of the bill. It is standard process to add days of grace.
  3. The date obtained after adding the three days to the due date is called the maturity date of the bill.

However, the application of the days of grace depend on the following situations:

  1. Days of grace are not applicable when a bill is payable 'at sight' or on demand.
  2. When the period of the bill is mentioned in months, the calculation of the maturity date will be in the terms of calendar month.
  3. When the period of the bill is mentioned in days, the calculation of the maturity date is also calculated in days including the date of payment but excluding the date of transaction.
  4. If the bill matures on a national holiday or Sunday, then the preceding business day becomes the maturity date of the bill.
  5. For example, if the maturity date of a bill is calculated as on 15th August, 2015 then the preceding day that is 14th August, 2015 will be considered as the maturity date.
  6. If the maturity day happens to be an emergency holiday declared under the Negotiable Instruments Act, 1881, then the next working day is to be considered as the maturity date.

Solution LA 4

 

Bills of Exchange

Promissory Note

It is an order to pay.

It is a promise to pay.

There are three parties involved, drawer, acceptor and payee.

There are two parties involved, maker and payee.

It is drawn by the creditor.

It is drawn by the debtors.

It needs acceptance by the drawee.

Acceptance is not required.

Drawer and payee may be the same.

Promissor cannot be the payee.

In case of dishonour of the bill, the bill may get noted.

Noting is not necessary.

 

Solution LA 5

When the drawee of the bill pays off the amount of the bill before the maturity of the bill it is called retirement of the bill. Holder of the bill may give discount for such earlier payment which is called as 'rebate'.

As the holder of the bill provides the rebate, it is a loss for the holder of the bill and hence it is debited in the books of the holder when payment is received.

 

Cash A/c

Dr.

Rebate A/c

Dr.

---------To Bills Receivable A/c

 

(Being payment received and rebate allowed for early payment)

 

 

The rebate is a gain for the drawee; so, it is credited in the books of the drawee.

Bills Payable A/c

Dr.

            To Cash A/c

 

            To Rebate A/c

 

(Being bill paid before the due date and rebate received for early payment)

 

 

Solution LA 6

Bills receivable book is a special purpose book that is maintained to keep records of bills received from the debtors. It contains details such as acceptor's name, date of bill, due date and amount. for future references.

Benefits of maintaining the bill receivable book:

  1. Source of information: The general information related to the each of the bills i.e. the amount, due date and name of the drawee are recorded at one place and hence are easily accessible.
  2. Avoid fraud: As the details of all the bills are recorded at one place, possibility of fraud is reduced.
  3. Responsibility: The person who maintains the bills receivable book will also be responsible for any errors or omissions. Therefore, higher degree of accountability and responsibility exists. Also, if any error is detected, then it can be fixed quickly.
  4. Time saving: Recording of bills receivable through the bills receivable book takes lesser time than that of journal entry.

Solution LA 7

A bills payable book is a special purpose book, maintained to keep records of acceptance of bills, given to the creditors. It contains details of the amount, date of bill, due date and name of the drawer to whom acceptance is given for future references.

Benefits of Maintaining Bills Payable Book

  1. Source of information: The general information related to the each of the bills i.e. the amount, due date and name of the drawee are recorded at one place and hence are easily accessible.
  2. Avoid fraud: As the details of all the bills are recorded at one place, possibility of fraud is reduced.
  3. Time saving: Recording of bills receivable through the bills receivable book takes lesser time than that of journal entry.
  4. Responsibility: As the transactions are recorded by the same person errors if any can be easily detected and rectified. This leads to enhancement of responsibility and accountability of the accountant.

Solution NUM 1

 

Book of Rao

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 01 

Reddy A/c

Dr. 

 

10,000 

  

  

----------To Sales A/c

     

10,000 

  

(Being goods sold to Reddy)

     

  

  

 

  

   

  

Jan 01 

Cash A/c

Dr. 

 

5,000 

  

  

----------To Reddy A/c

     

5,000 

  

(Being cash received from Reddy)

     

  

  

       

  

Jan 01 

Bills Receivable A/c

Dr. 

 

5,000 

  

  

----------To Reddy A/c

     

5,000 

  

(Being bill received and accepted from Reddy for 30 days)

     

  

  

       

  

Feb 03 

Cash A/c

Dr. 

 

5,000 

  

  

----------To Bills Receivable A/c

     

5,000 

 

(Being Reddy's acceptance met on due date)

       

  

 

  

 

  

  

 

Books of Reddy

Rao's Account 

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount 

Rs. 

Date 

Particulars 

J.F. 

Amount 

Rs. 

2016 

     

2016 

 

  

  

Jan 01 

To Cash A/c

  

5,000 

Jan01 

By Purchases A/c

  

10,000 

Jan 01 

To Bills Payable A/c

  

5,000 

 

 

 

 

  

  

  

  

  

  

  

  

 

 

 

10,000

     

10,000 

 

 

Bills of Exchange Exercise 311

Solution NUM 2

Book of Parvati

Journal

Date 

 Particulars 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 01 

Shankar A/c

Dr. 

 

8,000 

  

  

----------To Sales A/c

     

8,000 

  

(Being goods sold to Shankar)

     

  

  

 

     

  

Jan 01 

Bills Receivable A/c

Dr. 

 

8,000 

  

  

----------To Shankar A/c

     

8,000 

  

(Being promissory note received from Shankar for three months)

     

  

  

 

     

  

Apr 05 

Cash A/c

Dr. 

 

8,000 

  

  

----------To Bills Receivable A/c

     

8,000 

  

(Being cash received for promissory note one day after the maturity date on account of holiday declared by govt.)

 

   

  

  

  

  

 

  

 
             

 

 

Book of Shankar

Journal

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 01 

Purchases A/c

Dr. 

 

8,000 

  

  

----------To Parvati A/c

     

8,000 

  

(Being goods purchased from Parvati)

     

  

  

 

     

  

Jan 01 

Parvati A/c

Dr. 

 

8,000 

  

  

----------To Bills Payable A/c

     

8,000 

  

(Being promissory note for three months sent to Parvati)

     

  

 

 

     

  

Apr 5

Bills Payable A/c

Dr.

 

8,000

 
 

----------To Cash A/c

     

8,000

 

(Being cash paid on maturity promissory note)

       

 

 

Solution NUM 3

Book of Vishal

Journal

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 05 

Manju A/c

Dr. 

 

7,000 

  

  

----------To Sales A/c

     

7,000 

  

(Being goods sold to Manju)

     

  

  

 

     

  

Jan 05 

Bills Receivable A/c

Dr. 

 

7,000 

  

  

----------To Manju A/c

     

7,000 

  

(Being bill received with Manju's acceptance for two months)

     

  

  

 

     

  

Jan 05 

Bank A/c

Dr. 

 

6,860 

  

  

Discount A/c

Dr. 

 

140 

7,000 

  

----------To Bills Receivable A/c

     

  

  

(Being bill receivable discounted with the bank @ 12 % p.a. for two months)

   

  

  

 

Note: On payment of the bill, no entry will be made.

 

 

Book of Manju

Journal

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 05 

Purchases A/c

Dr. 

 

7,000 

  

  

----------To Vishal A/c

     

7,000 

  

(Being goods purchased from Vishal)

     

  

  

 

     

  

Jan 05 

Vishal A/c

Dr. 

 

7,000 

  

  

----------To Bills Payable A/c

     

7,000 

  

(Being bill accepted drawn by Vishal)

     

  

 

 

 

 

 

 

Mar08

Bills Payable A/c

Dr.

 

7,000

 

  

----------To Bank A/c

     

7,000

 

(Being amount of bill payable paid to bank on maturity)

       

 

 

Solution NUM 4

 

Book of Jimmi

Journal

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Feb 01 

John A/c

Dr. 

 

15,000 

  

  

 ----------To Sales A/c

     

15,000 

  

(Being goods sold to John)

     

  

  

 

     

  

Feb 01 

Bank A/c

Dr. 

 

5,000 

  

  

 ----------To John A/c

     

5,000 

  

(Being cheque received for Rs.5,000 from John)

     

  

  

 

     

  

Feb 01 

Bills Receivable A/c

Dr. 

 

10,000 

  

  

 ----------To John A/c

     

10,000 

  

(Being bill received from John for 40 days)

   

  

  

  

 

     

  

Mar 11 

Bill Sent for Collection A/c

Dr. 

 

10,000 

  

  

 ----------To Bills Receivable A/c

   

  

10,000 

  

(Being John's acceptance sent to bank for collection)

     

  

  

 

     

  

Mar 16 

Bank A/c

Dr. 

 

10,000 

  

  

 ----------To Bill Sent for Collection A/c

     

10,000 

  

(Being John's acceptance met on due date and bank received the payment)

 

   

  

 

 

Ledger

John's Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Feb 01 

To Sales A/c

 

15,000

Feb 01

By Bank A/c

 

5,000

       

Feb 01

By Bills Receivable A/c

 

10,000

               
     

15,000

     

15,000

 

 

Book of John

Journal 

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Feb 01 

Purchases A/c

Dr. 

 

15,000 

  

  

 ----------To Jimmi A/c

     

15,000 

  

(Being goods purchases from Jimmi)

     

  

  

 

     

  

Feb 01 

Jimmi A/c

Dr. 

 

5,000 

  

  

----------To Bank A/c

     

5,000 

  

(Being cheque paid to Jimmi)

     

  

  

 

     

  

Feb 01 

Jimmi A/c

Dr. 

 

10,000 

  

  

 ----------To Bills Payable A/c

     

10,000 

  

(Being bill draw accepted for 40 days)

   

  

  

  

 

     

  

Mar 16 

Bills Payable A/c

Dr. 

 

10,000 

  

  

 ----------To Bank A/c

   

  

10,000 

  

(Being payment made on maturity of the bill to bank)

     

  

 

 

Ledger

Jimmi's Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Feb 01 

To Bank A/c

 

5,000

Feb 01

By Purchases A/c

 

15,000

Feb 01

To Bills Payable A/c

 

10,000

       
               
     

15,000

     

15,000

 

 

Solution NUM 5

 

Books of Kartar

Journal Entries

Date 

Particulars 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2015 

  

 

 

  

  

Jan 15 

Bhagwan 

Dr. 

 

30,000 

  

  

----------To Sales A/c

 

 

 

30,000 

  

(Being goods sold to Bhagwan)

 

 

 

  

  

 

 

 

 

  

Jan 15 

Bills Receivable A/c

Dr. 

 

30,000 

  

  

----------To Bhagwan A/c

 

 

 

30,000 

  

(Being three bills of Rs.10,000 each, received from Bhagwan the first bill for one month, second bill for two months and third bill for three months)

 

 

 

  

  

   

 

 

  

Jan 15 

Ratna A/c

Dr. 

 

10,000 

  

  

 ----------To Bills Receivable A/c

 

 

 

10,000 

  

(Being the second bill endorsed to Ratna)

 

 

  

  

  

 

 

 

 

  

Jan 15 

Bank A/c

Dr. 

 

9,850 

  

  

Discount A/c

Dr. 

 

150 

  

  

----------To Bills Receivable A/c

 

 

 

10,000 

  

(Being bill discounted at 6% p.a.)

 

 

 

  

 

 

 

 

 

 

Feb 18 

Cash A/c

Dr. 

 

10,000 

  

  

----------To Bills Receivable A/c

 

 

 

10,000 

  

(Being the first bill met by Bhagwan, on due date)

 

 

 

  

             

 

 

Bhagwan's Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Jan 15 

To Sales A/c

 

30,000

Jan 15

By Bills Receivable A/c

 

30,000

               
     

30,000

     

30,000

 

 

Ratna's Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015

  

 

  

Jan 15 

To Bills Receivable A/c

 

10,000

Jan 31

 By Balance c/d

 

10,000

               
     

10,000

     

10,000

 

 

 

Bills Receivable Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Jan 15 

To Bhagwan A/c

 

30,000

Jan 15

By Ratna A/c

 

10,000

       

Jan 15

By Bank A/c

 

9,850

       

Jan 15

By Discount A/c

 

150

       

Jan 15

By Cash A/c

 

10,000

 

 

 

 

 

 

 

 

     

30,000

     

30,000

 

 

Cash Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Feb 18 

To Bills Receivable A/c

 

10,000

Feb 28

By Balance c/d

 

10,000

               
     

10,000

     

10,000

 

 

Bank's Account 

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Jan 15 

To Bills Receivable A/c

 

9,850

Jan 31

By Balance c/d

 

9,850

               
     

9,850

     

9,850

 

 

Books of Bhagwan

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2015 

  

 

 

  

  

Jan 15 

Purchases A/c

Dr. 

 

30,000 

  

 

  To Kartar A/c

 

 

 

30,000 

 

(Being good purchased from Kartar on Cr.)

 

 

 

  

 

 

  

 

 

  

Jan 15 

Kartar A/c

Dr. 

 

30,000 

  

 

  To Bills Payable A/c

 

 

 

30,000 

 

(Being three bill Rs.10,000 each drawn by Kartar the first bill for one month, the second bill for two months and the third bill for three months, accepted and returned them to Kartar)

 

 

 

  

   

 

     

Feb 18 

Bills Payable A/c

Dr.

 

10,000

 
 

 To Cash A/c

     

10,000

 

(Being first was paid on due date)

       
           

Mar18

Bills Payable A/c

Dr.

 

10,000

 
 

 To Bank A/c

     

10,000

 

(Being second bill was paid on due to Ratna)

       
           

Apr 18

Bills Payable A/c

Dr.

 

10,000

 
 

 To Bank A/c

     

10,000

 

(Being third bill was paid on due to bank)

       

 

Kartar's Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Jan 15 

To Bills Payable A/c

 

30,000

Jan 15

By Purchases A/c

 

30,000

 

 

           
     

30,000

     

30,000

 

 

 

Bills Payable Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Feb 18 

To Cash A/c

 

10,000

Jan 15

By Kartar A/c

 

30,000

Mar 18

To Bank A/c

 

10,000

       

Apr 18

To Bank A/c

 

10,000

       
     

30,000

     

30,000

 

 

Cash Account

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Feb28 

To Balance c/d

 

10,000

Feb 18

By Bills Payable A/c

 

10,000

               
     

10,000

     

10,000

 

 

Bank Account 

Dr. 

           

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2015 

  

   

2015 

  

 

  

Apr 31 

To Balance c/d 

 

20,000

Mar18

By Bills Payable A/c

 

10,000

       

Apr18

By Bills Payable A/c

 

10,000

               
     

20,000

     

20,000

 

Solution NUM 6

As per the provisions of Negotiable Instrument Act, when the maturity date of any bill falls on a public holiday then the maturity date of the bill will be the previous business day.

20 days after Jan 01, 2016 is 21st Jan, 2016. Adding 3 days of grace, we get the maturity date as 24th Jan, 2016. Previous business day is 23rd Jan, 2016.

 

 

Book of Arun

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016

  

   

  

  

Jan 01 

Sunil A/c

Dr. 

 

30,000 

  

  

 ---------To Sales A/c

     

30,000 

  

(Being goods sold to Sunil)

     

  

  

 

     

  

Jan 01 

Cash A/c

Dr. 

 

14,700 

  

  

Discount Allowed A/c

Dr. 

 

300 

  

  

 ---------To Sunil A/c

     

15,000 

  

(Being half of the amount due from Sunil was received and allowed him 2% cash discount)

 

   

  

  

 

     

  

Jan 01 

Bills Receivable A/c

Dr. 

 

15,000 

  

  

---------To Sunil A/c

     

15,000 

  

(Being promissory note received for balance amount due from Sunil)

 

 

  

  

  

 

     

  

Jan 23 

Cash A/c

Dr. 

 

15,000 

  

  

---------To Bills Receivable A/c

     

15,000  

  

(Being cash received from Sunil one day before the maturity date due to public holiday)

 

   

  

 

 

 

Book of Sunil

Journal Entries

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan01 

Purchases A/c

Dr. 

 

30,000 

  

  

---------To Arun A/c

     

30,000 

  

(Being goods purchased from Arun)

       
           

Jan 01

Arun A/c

Dr.

 

15,000

 
 

---------To Cash A/c

     

14,700

 

---------To Discount Received A/c

     

300

 

(Being half amount due to Arun paid by cheque and 2% discount allowed by him)

       
           

Jan 01

Arun A/c

Dr.

 

15,000

 
 

---------To Bills Payable A/c

     

15,000

 

(Being promissory note issued in favour of Arun for twenty days)

       
           

Jan 23

Bills Payable A/c

Dr.

 

15,000

 
 

---------To Cash A/c

     

15,000

 

(Being promissory note met one day before the maturity day)

       

 

 

Solution NUM 7

Case i: When the bill was retained by Darshan till the date of its maturity

 

Books of Darshan

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Varun A/c

Dr. 

 

40,000 

  

  

---------To Sales A/c

     

40,000 

  

(Being goods sold to Varun)

     

  

  

 

     

  

Jan 08 

Bills Receivable A/c

Dr. 

 

40,000 

  

  

 ---------To Varun A/c

     

40,000 

  

(Being Varun's acceptance received)

     

  

  

 

     

  

Mar 11 

Cash A/c

Dr. 

 

40,000 

  

  

 ---------To Bills Receivable A/c

     

40,000 

  

(Being bill met on due date)

   

  

  

  

Varun A/c

  

 

  

 

 

 

Book of Varun

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Purchases A/c

Dr. 

 

40,000 

  

  

---------To Darshan A/c

     

40,000 

  

(Being goods bought from Darshan)

     

  

  

 

     

  

Jan 08 

Darshan A/c

Dr. 

 

40,000 

  

  

  To Bills Payable A/c

     

40,000 

  

(Being bill of two months accepted for Darshan)

 

   

  

  

 

     

  

Mar 11 

Bills Payable A/c

Dr. 

 

40,000

 
 

 To Cash A/c

     

40,000

 

(Being Varun cleared his acceptance on the due date)

       

 

 

Case ii: When Darshan immediately discounted the bill @ 6% p.a. with his bank.

 

 

Book of Darshan

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Varun A/c

Dr. 

 

40,000 

  

  

 ---------To Sales A/c

     

40,000 

  

(Being goods sold to Varun)

     

  

  

 

     

  

Jan 08 

Bills Receivable A/c

Dr. 

 

40,000 

  

  

---------To Varun

     

40,000 

  

(Being B/R received from Varun for two months)

 

   

  

  

 

     

  

Jan08 

Bank A/c

Dr. 

 

39,600

 
 

Discount A/c

Dr.

 

400

 
 

---------To Bills Receivable A/c

     

40,000

 

(Being bill discounted with the bank @ 6 % p.a.)

       

 

 

 

Book of Varun

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Purchases A/c

Dr. 

 

40,000 

  

  

---------To Darshan A/c

     

40,000 

  

(Being goods bought from Darshan)

     

  

  

 

     

  

Jan 08 

Darshan A/c

Dr. 

 

40,000 

  

  

 ---------To Bills Payable A/c

     

40,000 

  

(Being bill of two month accepted for darshan)

 

   

  

  

 

     

  

 Mar 11 

Bills Payable A/c

Dr. 

 

40,000

 
 

---------To Bank A/c

     

40,000

 

(Being Varun cleared his acceptance on the due date)

       

 

 

Case iii: When the bill was endorsed immediately by Darshan in favour of his Cr. or Suresh.

 

Book of Darshan

Journal Entries

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Varun A/c

Dr. 

 

40,000 

  

 

 ---------To Sales A/c

     

40,000 

 

(Being goods sold to Varun)

     

  

 

 

     

  

Jan 08 

Bills Receivable A/c

Dr. 

 

40,000 

  

 

 ---------To Varun A/c

     

40,000 

 

(Being Varun's acceptance received for two months)

 

   

  

 

 

     

  

Jan 08 

Suresh A/c

Dr. 

 

40,000

 
 

---------To Bills Receivable A/c

     

40,000

 

(Being Varun's acceptance endorsed in favour of Suresh)

       

 

 

 

Book of Varun

Journal Entries 

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Purchases A/c

Dr. 

 

40,000 

  

  

 ---------To Darshan A/c

     

40,000 

  

(Being goods bought from Darshan)

     

  

  

 

     

  

Jan 08 

Darshan A/c

Dr. 

 

40,000 

  

  

 ---------To bills payable A/c

     

40,000 

  

(Being bill drawn by Darshan accepted for two months)

 

   

  

  

 

     

  

 Mar 11 

Bills Payable A/c

Dr. 

 

40,000

 
 

---------To Cash A/c

     

40,000

 

(Being bills paid to holder of bill)

       

 

 

Case iv: When three days before its maturity, the bill was sent by Darshan to his bank for collection.

 

Book of Darshan

Journal Entries 

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Varun A/c

Dr. 

 

40,000 

  

  

 ---------To Sale A/c

     

40,000 

  

(Being goods sold to Varun)

     

  

  

 

     

  

Jan 08 

Bills Receivable A/c

Dr. 

 

40,000 

  

  

 ---------To Varun A/c

     

40,000 

  

(Being Varun's acceptance received two months)

 

   

  

  

 

     

  

 Mar 08 

Bill sent for Collection A/c

Dr. 

 

40,000

 
 

---------To Bills Receivable A/c

     

40,000

 

(Being bills send for collection send to the bank)

       
           

Mar 11

Bank A/c

Dr.

 

40,000

 
 

---------To Bill sent for collection

     

40,000

 

(Being bill sent for collection realised)

       

 

 

 

Book of Varun

Journal Entries 

Date 

Particulars 

 

L.F. 

Dr. 

Rs. 

Cr. 

Rs. 

2016 

  

   

  

  

Jan 08 

Purchases A/c

Dr. 

 

40,000 

  

  

---------To Darshan A/c

     

40,000 

  

(Being goods bought from Darshan)

     

  

  

 

     

  

Jan 08 

Darshan A/c

Dr. 

 

40,000 

  

  

 ---------To Bills Payable A/c

     

40,000 

  

(Being bill drawn by Darshan accepted for two months)

 

   

  

  

 

     

  

Mar 11

Bills Payable A/c

Dr.

 

40,000

 
 

---------To Bank A/c

     

40,000

 

(Being bill paid to the bank)

       

 

 

Bills of Exchange Exercise 312

Solution NUM 8

 

Book of Bansal Traders

Journal Entries 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Dec 21 

Mohan Traders A/c

Dr. 

 

900 

  

  

---------To Sales A/c

     

900 

  

(Being goods sold to Mohan Traders list price Rs.1,000 at 10% trade discount)

 

   

  

  

 

     

  

Dec 21 

Bills Receivable A/c

Dr. 

 

900 

  

  

---------To Mohan Traders A/c

     

900 

  

(Being promissory note received from Mohan Traders payable after 30 days)

 

   

  

  

 

     

  

Dec 26 

Mohan Traders A/c

Dr. 

 

1,080 

  

  

---------To Sales A/c

   

  

1,080 

 

(Being goods sold to Mohan Traders list price Rs.1,200 at 10% trade discount)

       
           

Dec 26

Bills Receivable A/c

Dr.

 

1,080

 
 

---------To Mohan Traders A/c

     

1,080

 

(Being promissory note received from Mohan Traders)

       
           

Dec 26

Bank A/c

Dr.

 

1,069

 
 

Discount A/c

Dr.

 

11

 
 

---------To Bills Receivable A/c

     

1,080

 

(Being promissory note discounted from the bank)

       
           

Dec 28

Mohan Traders A/c

Dr.

 

1,800

 
 

---------To Sales A/c

     

1,800

 

(Being sold to Mohan Traders list price Rs.2,000 at 10% trade discount)

       
           

Dec 28

Bills Receivable A/c

Dr.

 

1,800

 
 

--------To Mohan Traders A/c

     

1,800

 

(Being promissory note received from Mohan Traders)

       
           

Dec 28

Dream Soaps A/c

Dr.

 

1,900

 
 

--------To Bills Receivable A/c

     

1,800

 

--------To Discount Received A/c

     

100

 

(Being promissory note of Rs.1,800 send to Dream Soap in full settlement of amount due to him)

       
           

Dec31

Mohan Traders A/c

Dr.

 

4,500

 
 

---------To Sales A/c

     

4,500

 

(Being goods sold to Mohan trade list price Rs.5,000 at 10% trade discount)

       
           

Dec 31

Bills Receivable A/c

Dr.

 

4,500

 
 

---------To Mohan Traders A/c

     

4,500

 

(Being promissory note received from Mohan Traders for 30 days)

       
 2017          

Jan 23

Cash A/c

Dr.

 

900

 
 

---------To Bills Receivable A/c

     

900

 

(Being promissory note issued on Dec. 21, 2005 was met on maturity)

       
           

Jan 25

Bill Sent for Collection A/c

Dr.

 

4,500

 
 

---------To Bills Receivable A/c

     

4,500

 

(Being promissory note issued on Dec. 31, 2005 send for collection to bank)

       
           

Feb 02

Bank A/c

Dr.

 

4,500

 
 

---------To Bill Sent for Collection A/c

     

4,500

 

(Being bank got payment of bill send for collection on due date)

       

 

 

In the books of Bansal Traders

Mohan Trader's Account 

Dr. 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Dec 21 

To Sales A/c

 

900

Dec 21

By Bills Receivable A/c

 

900

Dec 26

To Sales A/c

 

1,080

Dec 26

By Bills Receivable A/c

 

1,080

Dec 28

To Sales A/c

 

1,800

Dec 28

By Bills Receivable A/c

 

1,800

Dec 31

To Sales A/c

 

4,500

Dec 31

By Bills Receivable A/c

 

4,500

     

8,280

     

8,280

 

 

 

Books of Mohan Trader's

Journal Entries 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Dec 21 

Purchases A/c

Dr. 

 

900 

  

  

---------To Bansal Traders A/c

     

900 

  

(Being goods bought Bansal Trader's list price Rs.1,000 at 10% trade discount)

 

   

  

  

 

     

  

Dec 21 

Bansal Traders A/c

Dr. 

 

900 

  

  

 ---------To Bills Payable A/c

     

900 

  

(Being promissory note issued to Bansal Traders)

 

   

  

  

 

     

  

Dec 26 

Purchases A/c

Dr. 

 

1,080 

  

  

---------To Bansal Traders A/c

   

  

1,080 

 

(Being goods bought from Bansal Traders list price Rs.1,200 at10% trade discount)

       
           

Dec 26

Bansal Traders A/c

Dr.

 

1,080

 
 

---------To Bills payable A/c

     

1,080

 

(Being promissory note issued to Bansal Traders)

       
           

Dec 28

Purchases A/c

Dr.

 

1,800

 
 

---------To Bansal Traders

     

1,800

 

(Being goods bought from Bansal Traders list price Rs.2,000 at 10% trade discount)

       
           

Dec 28

Bansal Traders A/c

Dr.

 

1,800

 
 

---------To Bills Payable A/c

     

1,800

 

(Being promissory note issued to Bansal Traders)

       
           

Dec 31

Purchases A/c

Dr.

 

4,500

 
 

---------To Bansal Traders A/c

     

4,500

 

(Being goods bought from Bansal Traders of list price Rs.5,000 at 10% trade discount)

       
           

Dec 31

Bansal Traders A/c

Dr.

 

4,500

 
 

---------To Bills Payable A/c

     

4,500

 

(Being promissory note issued to Bansal Traders)

       
2017           

Jan 23

Bills Payable A/c

Dr.

 

900

 
 

---------To Cash A/c

     

900

 

(Being the first note discharged on its due date)

       
           

Jan 28

Bill Payable A/c

Dr.

 

1,080

 
 

---------To Bank A/c

     

1,080

 

(Being the second promissory note discharged on its due date)

       
           

Jan 30

Bills Payable A/c

Dr.

 

1,800

 
 

---------To Cash A/c

     

1,800

 

(Being the third promissory discharged by paying Rs.1,800 to dream soaps)

       
           

Feb 02

Bills Payable A/c

Dr.

 

4,500

 
 

---------To Bank A/c

     

4,500

 

(Being the fourth promissory note discharged by paid Rs. 4,500 to bank)

       

 

 

In the book of Mohan Traders

Bansal Trader's Account 

Dr. 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Dec 21 

To Bills Payable A/c

 

900

Dec 21

By Purchases A/c

 

900

Dec 26

To Bills Payable A/c

 

1,080

Dec 26

By Purchases A/c

 

1,080

Dec 28

To Bills Payable A/c

 

1,800

Dec 28

By Purchases A/c

 

1,800

Dec 31

To Bills Payable A/c

 

4,500

Dec 31

By Purchases A/c

 

4,500

 

 

 

 

 

 

 

 

     

8,280

     

8,280

 

Solution NUM 9

Case i: When the bill was retained by Ravinderan with him till the date of its maturity

 

Book of Ravinderan

Journal Entries 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Narayanan A/c

Dr. 

 

25,000 

  

  

---------To Sales A/c

     

25,000 

  

(Being goods sold to Narayanan)

     

  

  

 

     

  

Feb 01 

Bills Receivable A/c

Dr. 

 

25,000 

  

  

---------To Narayanan A/c

     

25,000 

  

(Being Narayanan's acceptance received for 30 days)

     

  

  

 

     

  

Mar 06 

Narayanan A/c

Dr. 

 

25,000 

  

  

---------To Bills Receivable A/c

   

  

25,000 

  

(Being Narayanan failed to meet his acceptance and bill dishonoured)

 

     

 

 

 

Book of Narayanan

Journal 

 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Purchases A/c

Dr. 

 

25,000 

  

  

---------To Ravinderan A/c

     

25,000 

  

(Being goods bought from Ravinderan)

     

  

  

 

     

  

Feb 01 

Ravinderan A/c

Dr. 

 

25,000 

  

  

---------To Bills Payable A/c

     

25,000 

  

(Being Ravinderan's bill accepted)

     

  

  

 

     

  

Mar 05 

Bills Payable A/c

Dr. 

 

25,000 

  

  

------To Ravinderan A/c

   

  

25,000 

  

(Being bill dishonoured on maturity)

 

     
             

 

Case ii: When the bill was discounted by Ravinderan immediately with his bank @ 6% p.a.

 

Book of Ravinderan

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Narayanan A/c

Dr. 

 

25,000 

  

  

 ---------To Sales A/c

     

25,000 

  

(Being goods sold to Narayanan)

     

  

  

 

     

  

Feb 01 

Bills Receivable A/c

Dr. 

 

25,000 

  

  

 ---------To Narayanan A/c

     

25,000 

  

(Being Narayanan's acceptance received)

     

  

  

 

     

  

Feb 01 

Bank A/c

Dr. 

 

24,877 

  

  

Discounting Charges A/c

Dr.

 

123 

 
 

---------To Bills Receivable A/c

     

25,000

  

(Being Narayanan's acceptance got discounted with bank @ 6% p.a for 30 days)

 

     
   

 

     

Mar 06

Narayanan A/c

Dr. 

 

25,000

 
 

---------To Bank A/c

 

   

25,000

 

(Being Narayanan's acceptance dishonoured)

 

     

 

 

Book of Narayanan

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Purchases A/c

Dr. 

 

25,000 

  

  

---------To Ravinderan A/c

     

25,000 

  

(Being goods bought from Ravinderan)

  

   

  

  

 

     

  

Feb 01 

Ravinderan A/c

Dr. 

 

25,000 

  

  

 ---------To Bills payable A/c

     

25,000 

  

(Being Ravinderan's bill accepted)

     

  

  

 

     

  

Mar 06

Bills Payable A/c

Dr. 

 

25,000

 
 

---------To Ravinderan A/c

 

   

25,000

 

(Being dishonoured on maturity)

 

     

 

 

Case iii: When the bill was endorsed to his Cr. or Ganeshan.

 

Book of Ravinderan

Journal

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Narayanan A/c

Dr. 

 

25,000 

  

  

-------To Sales A/c

     

25,000 

  

(Being goods sold Narayanan)

     

  

  

 

     

  

Feb01 

Bills Receivable A/c

Dr. 

 

25,000 

  

  

---------To Narayanan A/c

     

25,000 

  

(Being Narayanan's acceptance received)

       
           

Feb 01

Ganeshan A/c

Dr.

 

25,000

 
 

---------To Bills Receivable A/c

     

25,000

 

(Being Narayanan's acceptance endorsed in favour of Ganeshan)

       

  

 

     

  

Mar 06

Narayanan A/c

Dr.

 

25,000

 
 

---------To Ganeshan A/c

 

   

25,000

 

(Being Narayanan's acceptance dishonoured)

 

     

 

 

Book Narayanan

Journal 

 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Purchases A/c

Dr. 

 

25,000 

  

  

 ---------To Ravinderan A/c

     

25,000 

  

(Being goods bought Ravinderan)

     

  

  

 

     

  

Feb 01 

Ravinderan A/c

Dr. 

 

25,000 

  

  

---------To Bills Payable A/c

     

25,000 

  

(Being Ravinderan's accepted received)

     

 

           

Mar 06

Bills Payable A/c

Dr.

 

25,000

 
 

---------To Ravinderan A/c

 

   

25,000

 

(Being Ravinderan's bill dishonoured on due date)

 

     
             

 

Case iv: When the bill was sent by Ravinderan to his bank for collection a few days before it maturity.

Books of Ravinderan

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Narayanan A/c

Dr. 

 

25,000 

  

  

 ---------To Sales A/c

     

25,000 

  

(Being goods sold to Narayanan)

     

  

  

 

     

  

Feb 01 

Bills Receivable A/c

Dr. 

 

25,000 

  

  

 ---------To Narayanan A/c

     

25,000 

  

(Being Narayanan's acceptance received)

       
           

Feb 01

Bills Sent for Collection A/c

Dr.

 

25,000

 
 

---------To Bills Receivable A/c

     

25,000 

 

(Being bill Send to bank for collection)

       
           

Mar 06

Narayanan A/c

Dr.

 

25,000

 
 

---------To Bills Sent for Collection A/c

 

   

25,000

 

(Being bill got dishonoured)

 

     

 

 

Book of Narayanan

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 01 

Purchases A/c

Dr. 

 

25,000 

  

  

---------To Ravinderan A/c

     

25,000 

  

(Being bought goods from Ravinderan)

     

  

  

 

     

  

Feb 01 

Ravinderan A/c

Dr. 

 

25,000 

  

  

---------To Bills Payable A/c

     

25,000 

  

(Being Ravinderan's bill accepted)

       
           

Mar 06

Bills Payable A/c

Dr.

 

25,000

 
 

---------To Ravinderan A/c

 

   

25,000

 

(Being Ravinderan's bill dishonoured)

 

     

 

Solution NUM 10

Books of Ravi

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb 13 

Sudershan A/c

Dr. 

 

40,000 

  

  

---------To Sales A/c

     

40,000 

  

(Being goods sold to Sudershan)

     

  

  

 

     

  

Feb 13 

Bills Receivable A/c

Dr. 

 

40,000 

  

  

---------To Sudershan A/c

     

40,000 

  

(Being four bills from Sudershan received: the first for Rs.5,000, the second bill for Rs.10,000, the third bill for Rs.12,000 and the fourth bill for Rs.13,000)

 

   

  

  

 

     

  

Feb 13 

Bank A/c

Dr. 

 

4,975 

  

  

Discount A/c

Dr. 

 

25 

  

  

---------To Bills Receivable A/c

     

5,000 

  

(Being the first bill discounted with bank at 6% p.a. for 1 month)

     

  

  

 

       

Feb 13

Mustaq A/c

Dr.

 

10,200

 
 

---------To Bills Receivable A/c

     

10,000

 

---------To Discount Received A/c

     

200

 

(Being the second bill endorsed to Mustaq in full settlement of amount Rs.10,200 due to him)

       
           

Mar 02

Bills Sent for Collection A/c

Dr.

 

13,000

 
 

---------To Bills Receivable A/c

     

13,000

 

(Being the forth bill send to bank for collection)

       
           

Mar 07

Sudershan A/c

Dr.

 

13,000

 
 

---------To Bill Sent for Collection A/c

     

13,000

 

(Being the fourth bill dishonoured on due date)

       
           

Mar 07

Sudershan A/c

Dr.

 

81

 
 

---------To Interest A/c

     

81

 

(Being interest due on the fourth bill Rs.13,000 for 19 days at 12% p.a.)

       
           

Mar 10

Cash A/c

Dr.

 

13,081

 
 

---------To Sudershan A/c

     

13,081

 

(Bing cash received from Sudershan)

       
           

Mar 16

Sudershan A/c

Dr.

 

5,000

 
 

---------To Bank A/c

     

5,000

 

(Being the first bill dishonoured)

       
           

Mar 16

Sudershan A/c

Dr.

 

50

 
 

---------To Interest A/c

     

50

 

(Being interest due on amount Rs.5,000 at 12% for one month)

       
           

Mar 19

Cash A/c

Dr.

 

5,050

 
 

---------To Sudershan A/c

     

5,050

 

(Being Sudershan paid the amount due on account dishonoured of the first bill plus interest)

       
           

Mar 28

Sudershan A/c

Dr.

 

10,000

 
 

Discount Received A/c

Dr.

 

200

 
 

---------To Mustaq A/c

     

10,200

 

(Being second bill dishonoured, which had endorsed in favour of Mustaq)

       
           

Mar 28

Sudershan A/c

Dr.

 

132

 
 

---------To Interest A/c

     

132

 

(Being interest charges at 12% on the amount due on account of dishonour of the second bill Rs.10,000)

       
           

Apr 01

Cash A/c

Dr.

 

10,132

 
 

---------To Sudershan A/c

     

10,132

 

(Being received cash from Sudershan for the second bill along with interest)

       
           

May 16

Sudershan A/c

Dr.

 

12,000

 
 

---------To Bills Receivable A/c

     

12,000

 

(Being the third bill dishonoured on due date)

       
           

May 16

Sudershan A/c

Dr.

 

360

 
 

---------To Interest A/c

     

360

 

(Being interest at 12% for 3 months charged on the amount due on account of dishonour the third bill Rs.12,000)

       
           

May 19

Cash A/c

Dr.

 

12,360

 
 

---------To Sudershan A/c

     

12,360

 

(Being cash received from Sudershan for the third bill along with interest 12% p.a.)

       

 

 

 

Ledger

Sundershan's Account 

Dr. 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Feb 13 

To Sales A/c

 

40,000

Feb 13

By Bills Receivable A/c

 

40,000

Mar 07

To Bill sent for Collection A/c

 

13,000

Mar 10

By Cash A/c

 

13,081

Mar 07

To Interest A/c

 

81

Mar 19

By Cash A/c

 

5,050

Mar 16

To Bank A/c

 

5,000

Apr 01

By Cash A/c

 

10,132

Mar 16

To Interest A/c

 

50

May 19

By Cash A/c

 

12,360

Mar 28

To Mustaq A/c

 

10,000

       

Mar 28

To Interest A/c

 

132

       

May 16

To Bills Receivable A/c

 

12,000

       

May 16

To Interest A/c

 

360

       

 

 

 

 

 

 

 

 

     

80,623

     

80,623

 

 

Mustaq's Account 

Dr. 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Feb 13 

To Bills Receivable A/c

 

10,000

Mar 28

By Sudershan A/c

 

10,000

Feb 13

To Discount Received A/c

 

200

Mar 28

By Discount Received A/c

 

200

               
     

10,200

     

10,200

 

 

 

Book of Sudershan

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb13 

Purchases A/c

Dr. 

 

40,000 

  

 

---------To Ravi A/c

     

40,000 

 

(Being goods bought from Ravi)

     

  

 

 

     

  

Feb13 

Ravi A/c

Dr. 

 

40,000 

  

 

 ---------To Bills Payable A/c

     

40,000 

 

(Being four bills drawn by Ravi accepted: the first second for Rs.5,000, payable after one month, the second for Rs.10,000, payable after 40 days, the third for Rs.12,000 payable after 3 month and the fourth for Rs.13,000 payable after 19 days)

 

   

  

 

 

     

  

Mar 07

Bills Payable A/c

Dr.

 

13,000

 
 

---------To Ravi A/c

     

13,000

 

(Being the fourth bill dishonoured)

       
           

Mar 07

Interest A/c

Dr.

 

81

 
 

---------To Ravi A/c

     

81

 

(Being interest charged for the fourth bill at 12% p.a.)

       
           

Mar 10

Ravi A/c

Dr.

 

13,081

 
 

---------To Cash A/c

     

13,081

 

(Bing cash paid to Ravi for amount of dishonour of the fourth bill along with interest at 12% p.a. for 19 days)

       
           

Mar 16

Bills Payable A/c

Dr.

 

5,000

 
 

---------To Ravi A/c

     

5,000

 

(Being the first bill dishonoured)

       
           

Mar 16

Interest A/c

Dr.

 

50

 
 

---------To Ravi A/c

     

50

 

(Being interest at 12% p.a on the first bill for one month)

       
           

Mar19

Ravi A/c

Dr.

 

5,050

 
 

---------To Cash A/c

     

5,050

 

(Being cash paid to Ravi amount due on account of dishonour of the first bill along with interest at 12% p.a. for one month)

       
           

Mar 28

Bills Payable A/c

Dr.

 

10,000

 
 

---------To Ravi A/c

     

10,200

 

(The second bill dishonoured)

       
           

Mar 28

Interest A/c

Dr.

 

132

 
 

---------To Ravi A/c

     

132

 

(Being interest charges at 12% p.a. for 40 days on the second bill)

       
           

Apr 01

Ravi A/c

Dr.

 

10,132

 
 

---------To Cash A/c

     

10,132

 

(Being cash paid to Ravi for amount due on account of dishonour of the second bill along with interest at 12% p.a. for 40 days)

       
           

May 16

Bills Payable A/c

Dr.

 

12,000

 
 

---------To Ravi A/c

     

12,000

 

(Being the third bill dishonoured)

       
           

May 16

Interest A/c

Dr.

 

360

 
 

---------To Cash A/c

     

360

 

(Being interest at 12% p.a. for 3 months on third bill)

       
           

May 19

Ravi A/c

Dr.

 

12,360

 
 

---------To Cash A/c

     

12,360

 

(Being cash paid for amount due on account of dishonour of the third bill along with interest 12% p.a. for 3 months)

       

 

 

Book of Mustaq

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Feb13 

Bills Receivable A/c

Dr. 

 

10,000 

  

  

Discount Allowed A/c

Dr.

 

200

 
 

---------To Ravi A/c

     

10,200 

  

(Being bills receivable received from Ravi and allowed discount)

     

  

  

 

     

  

Mar 28

Ravi A/c

Dr.

 

10,200

 
 

---------To Bills Receivable A/c

     

10,000

 

---------To Discount Received A/c

     

200

 

(Being bill dishonoured)

       
           

 

 

 

Book of Bank

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Mar02 

Bills Receivable A/c

Dr. 

 

13,000 

  

 

---------To Bills sent for Collection A/c

     

13,000 

  

(Being bills received from Ravi for collection)

     

  

  

 

     

  

Mar 07

Bills sent for Collection A/c

Dr.

 

13,000 

 
 

---------To Bills Receivable A/c

     

13,000 

 

(Being bill dishonoured)

       
           

 

 

Bills of Exchange Exercise 313

Solution NUM 11

 

Book of Neha

Journal 

Date

Particulars

 

L.F.

Dr.

Rs. 

Cr.

Rs. 

2016

 

   

  

  

Jan 01

Muskan A/c

Dr.

 

20,000

  

 

---------To Sales A/c

     

20,000

 

(Being goods sold to Muskan)

     

 

 

 

     

 

Jan 01

Bills Receivable A/c

Dr.

 

20,000

 

 

---------To Muskan A/c

     

20,000

 

(Being Muskan's acceptance received)

     

 

 

 

     

 

Feb 04

Cash A/c

Dr.

 

19,800

 

 

Rebate on bill A/c

Dr.

 

200

 

 

---------To Bills Receivable A/c

     

20,000

 

(Being Muskan's acceptance retired one month before maturity and allowed rebate at 12% p.a.)

       
           

 

 

Book of Muskan

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Jan 01 

Purchases A/c

Dr. 

 

20,000 

  

  

---------To Neha A/c

     

20,000 

  

(Being goods bought from Neha)

     

  

  

 

     

  

Jan 01 

Neha A/c

Dr. 

 

20,000 

  

  

---------ToBills Payable A/c

     

20,000 

  

(Being bill drawn by Neha payable after 2 months accepted)

     

  

  

 

     

  

Feb 04 

Bills Payable A/c

Dr. 

 

20,000 

  

 

---------To Cash A/c

     

19,800

 

---------To Rebate on Bills A/c

     

200

 

(Being bill paid one month before maturity and received rebate at 12% p.a.)

       

 

 

Solution NUM 12

Books of Raghu

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

  

   

  

  

Jan 15 

Devendra A/c

Dr. 

 

35,000 

  

  

 ---------To Sales A/c

     

35,000 

  

(Being goods sold to Devendra)

     

  

  

 

     

  

Jan 15 

Bills Receivable A/c

Dr. 

 

35,000 

  

  

--------- To Devendra A/c

     

35,000 

  

(Being three bills received from Devendra; first bill for Rs.5,000, second bill for Rs.20,000 and third bill Rs.10,000)

 

   

  

  

 

     

  

Jan 15 

Dewan A/c

Dr. 

 

5,200 

  

  

--------- To Bills Receivable A/c

   

  

5,000 

  

--------- To Discount Received A/c

     

200 

  

(Being the first bill endorsed to Dewan in full settlement of amount due to him)

 

   

  

  

 

     

  

Jan.15 

Bank A/c

Dr. 

 

19,700 

  

  

Bills Discounting Charges A/c

Dr. 

 

300 

  

  

--------- To Bills Receivable A/c

     

20,000 

  

(Being the second bill discounted with bank at 6% p.a.)

     

  

  

 

     

  

Apr 18 

Devendra A/c

Dr. 

 

20,030 

  

  

 ---------To Bank A/c

     

20,030 

  

(Being the second bill dishonoured and bank paid Rs.30 for noting charges)

 

   

  

  

 

     

  

May 14 

Bill Sent for Collection A/c

Dr. 

 

10,000 

 
 

---------To Bills Receivable A/c

     

10,000

 

(Being third bill send to bank for collection)

       
           

May 18

Devendra A/c

Dr.

 

10,200

 
 

---------To Bill Sent for Collection A/c

     

10,000

 

---------To Bank A/c

     

200

 

(Being the third bill dishonoured and bank paid Rs.200 as noting charges)

       
           

May 23

Devendra A/c

Dr.

 

1,000

 
 

---------To Interest A/c

     

1,000

 

(Being interest due to Devendra on of bills dishonoured)

       
           

May 23

Cash A/c

Dr.

 

31,230

 
 

---------To Devendra A/c

     

31,230 

 

(Being entire amount received from Devendra)

       

 

 

Ledger

Devendra's Account 

Dr. 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Jan 15 

To Sales A/c

 

35,000

Jan 15

By Bills Receivable A/c

 

35,000

Apr 18

To Bank A/c

 

20,030

May 23

By Cash A/c

 

31,230

May 18

To Bills sent for Collection A/c

 

10,000

       

May 18

To Bank A/c

 

200

       

May 23

To Interest A/c

 

1,000

       

 

 

 

 

 

 

 

 

     

66,230

     

66,230

 

 

 

Books of Devendra

Journal 

Date

Particulars

 

L.F.

Dr.

Rs. 

Cr.

Rs. 

2016

 

   

  

  

Jan 15

Purchases A/c

Dr.

 

35,000

  

 

---------To Raghu A/c

     

35,000

 

(Being goods bought from Raghu)

     

 

 

 

     

 

Jan 15

Raghu A/c

Dr.

 

35,000

 

 

 ---------To Bills Payable A/c

     

35,000

 

(Being three bills drawn by Raghu accepted: first bill for Rs.5,000 payable after one month, second for Rs.20,000 payable after 3 months and third for Rs.10,000 payable after 4 months)

     

 

 

 

     

 

Feb 18

Bills Payable A/C

Dr.

 

5,000

 
 

---------To Cash A/c

     

5,000

 

(Being the first bill discharged on the due date)

       
           

Apr18

Bills Payable A/c

Dr.

 

20,000

 

 

Noting Charges A/c

Dr.

 

30

 

 

---------To Raghu A/c

     

20,030

 

(Being the second bill dishonoured and noting charges Rs.30)

       
           

May 18

Bills Payable A/c

Dr.

 

10,000

 
 

Noting Charges A/c

Dr.

 

200

 
 

---------To Raghu A/c

     

10,200

 

(Being third bill dishonoured and noting charges Rs.200)

       
           

May 23

Interest A/c

Dr.

 

1,000

 
 

---------To Raghu A/c

     

1,000

 

(Being interest charges Rs.1,000 due to bills dishonoured)

       
           

May 23

Cash A/c

Dr.

 

31,230

 
 

---------To Bank Loan A/c

     

31,230

 

(Being bank loan taken for settling Raghu's account)

       
           

May 23

Raghu A/c

Dr.

 

31,230

 
 

---------To Cash A/c

     

31,230

 

(Being cash paid to Raghu in settlement of the bills.)

       

 

 

 

Ledger

Raghu's Account 

Dr. 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2016 

  

   

2016 

  

 

  

Jan 15 

To Bills Payable A/c

 

35,000

Jan 15

By Purchases A/c

 

35,000

May 23

To Cash A/c

 

31,230

Apr 18

By Bills Payable A/c

 

20,000

       

Apr 18

By Noting Charges A/c

 

30

       

May 18

By Bills Payable A/c

 

10,000

       

May 18

By Noting Charges A/c

 

200

       

May 18

By Interest A/c

 

1,000

 

 

 

 

 

 

 

 

     

66,230

     

66,230

 

 

 

Book of Dewan Journal 

Date

Particulars

 

L.F.

Dr.

Rs. 

Cr.

Rs. 

2016

 

   

  

  

Jan15

Bills Receivable A/c

Dr.

 

5,000

  

 

Discount Allowed A/c

Dr.

 

200

 

 

---------To Raghu A/c

     

5,200

 

(Being bill receivable received from Raghu for one month and allowed him discount of Rs.200)

     

 

 

 

     

 

Feb18

Cash A/c

Dr.

 

5,000

 
 

---------To Bills Receivable A/c

     

5,000

 

(Being amount received on maturity of the bill)

       

 

 

Solution NUM 13

Case i : The bill was retained by Kamal till the date of its maturity

 

Book of Kamal

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan 15 

Vimal A/c

Dr. 

 

25,000 

  

 

 ---------To Sales A/c

     

25,000 

 

(Being goods sold to Vimal)

     

  

 

 

     

  

Jan 15 

Bills Receivable A/c

Dr. 

 

25,000 

  

 

--------- To Vimal A/c

     

25,000 

 

(Being Vimal's acceptance received)

     

  

 

 

     

  

Mar 18 

Vimal A/c

Dr. 

 

25,000 

  

 

---------To Bills Receivable A/c

     

25,000 

 

(Being Vimal acceptance dishonoured)

     

  

 

 

Book of Vimal

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan 15 

Purchases A/c

Dr. 

 

25,000 

  

 

--------- To Kamal A/c

     

25,000 

 

(Being goods bought from Kamal)

     

  

 

 

     

  

Jan 15 

Kamal A/c

Dr. 

 

25,000 

  

 

--------- To Bills Payable A/c

     

25,000 

 

(Being bill drawn Kamal accepted)

     

  

 

 

     

  

Mar 18 

Bills Payable A/c

Dr. 

 

25,000 

  

 

---------To Kamal A/c

     

25,000 

 

(Being bill drawn by Kamal dishonoured)

     

  

 

 

Case ii: The bill was immediately discounted by Kamal with his bank @ 6% p.a.

 

Book of Kamal

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan15 

Vimal A/c

Dr. 

 

25,000 

  

 

--------- To Sales A/c

     

25,000 

 

(Being goods sold to Vimal)

     

  

 

 

     

  

Jan15 

Bills Receivable A/c

Dr. 

 

25,000 

  

 

--------- To Vimal A/c

     

25,000 

 

(Being Vimal's acceptance received)

     

  

 

 

     

  

Jan15 

Bank A/c

Dr. 

 

24,750 

  

 

Bills Discounting Charges A/c

Dr.

 

250

 
 

---------To Bills Receivable A/c

     

25,000 

 

(Being Vimal's acceptance discounted at 6% p.a with bank)

     

  

 

 

   

  

 

Mar 18

Vimal A/c

Dr.

 

25,000

 
 

---------To Bank A/c

     

25,000

 

 (Being Vimal's acceptance dishonoured)

       

 

Book of Vimal

Journal

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan 15 

Purchases A/c

Dr. 

 

25,000 

  

 

 --------- To Kamal A/c

     

25,000 

 

(Being goods bought from Kamal)

     

  

 

 

     

  

Jan 15 

Kamal A/c

Dr. 

 

25,000 

  

 

--------- To Bills Payable A/c

     

25,000 

 

(Being bill drawn by Kamal accepted)

     

  

 

 

     

  

Mar 18

Bills Payable A/c

Dr.

 

25,000

 
 

---------To Kamal A/c

     

25,000

 

 (Being bills drawn by Kamal dishonoured)

       

 

Case iii: The bill was endorsed by Kamal in favour of his Cr. or Sharad.

 

Book of Kamal

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan15 

Vimal A/c

Dr. 

 

25,000 

  

 

 ---------To Sales A/c

     

25,000 

 

(Being goods sold to Vimal)

     

  

 

 

     

  

Jan15 

Bills Receivable A/c

Dr. 

 

25,000 

  

 

--------- To Vimal A/c

     

25,000 

 

(Being Vimal's acceptence received)

     

  

           

Jan 15

Sharad A/c

Dr.

 

25,000

 
 

---------To Bills Receivable A/c

     

25,000

 

(Being Vimal's acceptance endorsed to Sharad)

       
 

 

     

  

Mar 18

Vimal A/c

Dr.

 

25,000

 
 

---------To Sharad A/c

     

25,000

 

(Being Vimal's acceptance endorsed to Kamal dishonoured)

       

 

 

 

Book of Vimal

Journal

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan15 

Purchases A/c

Dr. 

 

25,000 

  

 

 ---------To Kamal A/c

     

25,000 

 

(Being goods bought from Kamal)

     

  

 

 

     

  

Jan15 

Kamal A/c

Dr. 

 

25,000 

  

 

--------- To Bills Payable A/c

     

25,000 

 

(Being bill drawn by Kamal accepted)

     

  

           

Mar 18

Bills Payable A/c

Dr.

 

25,000

 
 

---------To Kamal A/c

     

25,000

 

 (Being bill drawn by Kamal dishonoured)

       

 

 

Caseiv: Five days before its maturity the bill was sent by Kamal to his bank for collection.

 

 

Book of Kamal

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan 15 

Vimal A/c

Dr. 

 

25,000 

  

 

 ---------To Sales A/c

     

25,000 

 

(Being goods sold to Vimal)

     

  

 

 

     

  

Jan 15 

Bills Receivable A/c

Dr. 

 

25,000 

  

 

--------- To Vimal A/c

     

25,000 

 

(Being Vimal's acceptance received)

     

  

           

 

 

 

 

 

 

Mar 13

Bills Sent for Collection A/c

Dr.

 

25,000 

 
 

---------To Bills Receivable A/c

     

25,000

 

(Being Vimal's acceptance send to bank for collection)

       
           

 

 

 

 

 

 

Mar 18

Vimal A/c

Dr.

 

25,000

 
 

---------To Bill Send for Collection A/c

     

25,000

 

(Being Vimal's acceptance dishonoured)

       

 

 

 

Book of Vimal

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2016 

         

Jan 15 

Purchases A/c

Dr. 

 

25,000 

  

 

---------To Kamal A/c

     

25,000 

 

(Being goods bought from Kamal)

     

  

 

 

     

  

Jan 15 

Kamal A/c

Dr. 

 

25,000 

  

 

--------- To Bills Payable A/c

     

25,000 

 

(Being bill drawn by Kamal accepted)

     

  

           

Mar 18

 Bills Payable A/c

Dr.

 

25,000

 
 

---------To Kamal A/c

     

25,000

 

 (Being bill drawn by Kamal dishonoured)

       

 

 

Bills of Exchange Exercise 314

Solution NUM 14

Books of Abdula

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2017 

 

 

 

 

 

 

Jan 17 

Tahir A/c

Dr. 

 

18,000 

 

 

 ---------To Sales A/c

 

 

 

18,000 

 

(Being goods sold to Tahir)

 

 

 

 

 

 

 

 

 

 

Jan17 

Bills Receivable A/c

Dr. 

 

18,000 

 

 

---------To Tahir A/c

 

 

 

18,000 

 

(Being Tahir's acceptance received)

 

 

 

 

 

 

 

 

 

 

Mar 06 

Tahir A/c

Dr. 

 

18,040 

 

 

---------To Bills Receivable A/c

 

 

 

18,000 

 

---------To Cash A/c

 

 

 

40 

 

(Being Tahir's acceptance dishonoured and Rs.40 paid as noting charges)

 

 

 

 

 

 

 

 

 

 

Mar 06 

Tahir A/c

Dr. 

 

660 

 

 

---------To Interest A/c

 

 

 

660 

 

(Being interest charged from Tahir on account of bill dishonoured)

 

 

 

 

 

 

 

 

 

 

Mar 11 

Cash A/c

Dr. 

 

18,700 

 

 

---------To Tahir A/c

 

 

 

18,700 

 

(Being amount paid by Tahirto clear his account)

 

 

 

 

 

 

 

Ledger

Tahir's Account 

Dr. 

 

 

 

 

 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2017 

 

 

 

2017 

 

 

 

Jan 17 

To Sales A/c

 

18,000 

Jan 17 

By Bills Receivable A/c

 

18,000 

Mar 06 

To Bills Receivable A/c

 

18,000 

Mar 11 

By Cash A/c

 

18,700 

Mar 06 

To Cash A/c

 

40 

 

 

 

 

Mar 06 

To Interest A/c

 

660 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

36,700 

 

 

 

36,700 

 

 

 

Books of Tahir

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2017 

 

 

 

 

 

 

Jan 17 

Purchases A/c

Dr. 

 

18,000 

 

 

---------To Abdula A/c

 

 

 

18,000 

 

(Being goods bought from Abdula)

 

 

 

 

 

 

 

 

 

 

Jan 17 

Abdula A/c

Dr. 

 

18,000 

 

 

 ---------To Bills Payable A/c

 

 

 

18,000 

 

(Being bill drawn by Abdula accepted, payable after 45 days)

 

 

 

 

 

 

 

 

 

 

Mar 06 

Bills Payable A/c

Dr. 

 

18,000 

 

 

Noting Charges A/c

Dr.

 

40

 

 

---------To Abdula A/c

 

 

 

18,040 

 

(Being Abdula's bill dishonoured)

 

 

 

 

 

 

 

 

 

 

Mar 07 

Interest A/c

Dr. 

 

660 

 

 

---------To Abdula A/c

 

 

 

660 

 

(Being interest charged on account of bill dishonoured)

 

 

 

 

 

 

 

 

 

 

Mar 11 

Abdula A/c

Dr. 

 

18,700 

 

 

---------To Cash A/c

 

 

 

18,700 

 

(Being total amount paid to Abdula in cash)

 

 

 

 

 

Ledger

Abdula's Account

Dr. 

 

 

 

 

 

 

Cr. 

Date 

Particulars 

J.F. 

Amount Rs. 

Date 

Particulars 

J.F. 

Amount Rs. 

2017 

 

 

 

2017 

 

 

 

Jan 17 

To Bills Payable A/c

 

18,000 

Jan 17 

By Purchases A/c

 

18,000 

Mar 11 

To Cash A/c

 

18,700 

Mar 06 

By Bills Payable A/c

 

18,000 

   

 

 

Mar 06

By Noting Charges A/c

 

40

   

 

 

Mar 06

By Interest A/c

 

660

 

 

 

 

 

 

 

 

 

 

 

36,700 

 

 

 

36,700 

 

Solution NUM 15

 

Book of Asha

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2017 

  

       

Mar 02 

Nisha A/c

Dr. 

 

19,000 

 

  

----------To Sales A/c

     

19,000 

  

(Being goods sold to Nisha on Cr.)

       

  

         

Mar 02 

Cash A/c

Dr. 

 

4,000 

 

  

Bills Receivable A/c

Dr. 

 

15,000 

 

  

 ----------To Nisha A/c

     

19,000 

  

(Being cash paid and Nisha's acceptance received for 3 months for the balance amount)

 

     

  

         

Mar 02 

Bank A/c

Dr. 

 

14,775 

 

  

Discount A/c (15,000 * 6% * 3/12)

Dr. 

 

225 

 

  

----------To Bills Receivable A/c

     

15,000 

  

(Being Nisha's acceptance discounted with bank at 6% p.a.)

       
           

June 05 

NishaA/c

Dr. 

 

15,030 

 

  

----------To Bank A/c

     

15,030 

 

(Being Nisha's acceptance dishonoured and bank paid Rs.30 as noting charges)

 

     

 

 

 

Book of Nisha

Journal 

Date 

Particulars 

 

L.F. 

Dr.

Rs. 

Cr.

Rs. 

2017 

  

   

  

  

Mar 02 

Purchases A/c

Dr. 

 

19,000 

  

  

----------To Asha A/c

     

19,000 

  

(Being goods bought from Asha on Cr.)

     

  

           

Mar 02

Asha A/c

Dr.

 

19,000 

 
 

----------To Bills Payable A/c

     

15,000

 

----------To Cash A/c

     

4,000

  

(Being Asha's bill accepted payable after three month and Rs.4,000 paid in cash)

       
           

Jun 05

Bills Payable A/c

Dr.

 

15,000

 
 

Noting Charges A/c

Dr.

 

30

 
 

----------To Asha A/c

     

15,030

 

(Being Asha's bill dishonoured)

       

 

 

Solution NUM 16

Books of Sharma

Journal 

Date