Bill of Exchange - Numerical Questions Solutions

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Bill of Exchange – Numerical Questions Solutions

This page contains the CBSE accountancy class 11 chapter 8, Bill of Exchange questions Solutions . You can find the questions/answers/solutions for the
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This page contains solutions to numerical questions for the chapter 8 Bill of Exchange. If you’re looking for solutions for theoretical questions, you can find
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Bill of Exchange – Numerical Questions Solutions
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1. On Jan 01, 2015 Rao sold goods ₹ 10,000 to Reddy. Half of the payment was made immediately and for the remaining half Rao drew a bill of
exchange upon Reddy payable after 30 days. Reddy accepted the bill and returned it to Rao. On the due date Rao Presented the bill to Reddy and
received the payment.
Journalise the above transactions in the books of Rao and prepare of Rao’s account in the books of Reddy.
Books of Rao
Journal Entries
Debit Credit
Date Particulars L.F. Amount Amount
₹ ₹
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 paid by Reddy)
Jan 01 Bills Receivable A/c Dr. 5,000
To Reddy A/c 5,000
(Being Bill of Exchange drawn on Reddy for 30 days and duly accepted by him and returned)
Feb 03 Cash A/c Dr. 5,000
To Bills Receivable A/c 5,000
(Being Bill of Exchange matured and acceptance duly met on maturity date)
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Books of Reddy
Rao’s A/c
Dr. Cr.
Amount Amount
Date Particulars J.F. Date Particulars J.F.
₹ ₹
2016 2016
Jan 01 To Cash A/c 5,000 Jan 01 By Purchases A/c 10,000
Jan 01 To Bills Payable A/c 5,000
10,000 10,000
2. On Jan 01, 2016, Shankar purchased goods from Parvati for ₹ 8,000 and immediately drew a promissory note in favour of Parvati payable after 3
months. On the date of maturity of the promissory note, the Government of India declared a holiday under the Negotiable Instuments Act 1881.
Since, Parvati was unaware about the provision of the law regarding the date of maturity of the bill, she handed over the bill to her lawer, who duly
presented the bill and received the payment. The amount of the bill was handed over by the lawyer to Parvati immediately. Record the necessary
Journal entries in the books of Parvati and Shankar.
Books of Parvati
Journal Entries
Debit Credit
₹ ₹
2016
Jan 01 Shankar A/c Dr. 8,000
To Sales A/c 8,0
(Being goods sold to Shankar)
Jan 01 Bills Receivable A/c Dr. 8,000 x
To Shankar A/c 8,0
(Being Promissory note received from Shankar for 3 months)
Apr 05 Bank A/c Dr. 8,000
(Being Promissory note matured and duly met on maturity date)
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Books of Shankar
Journal
Debit Credit
₹ ₹
2016
Jan 01 Purchase 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 provided to Parvati)
Apr 05 Bills Payable A/c Dr. 8,000
To Bank A/c 8,000
(Being Promissory note matured and duly met on maturity date)
3. Vishal sold goods for ₹ 7,000 to Manju on Jan 05, 2016 and drew upon her a bill of exchange payable after 2 months. Manju accpted Vishal’s
draft and handed over the same to Vishal after acceptance. Vishal immediately discounted the bill with his bank @12 p.a. On the due date Manju
met her accptance.
Jounalise the above transactions in the books of Vishal and Manju.
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Books of Vishal
Journal
Debit Credit
₹ ₹
2016
Jan 05 Manju A/c Dr. 7,000
To Sales A/c 7,000
(Being goods sold to Manju)
To Manju A/c 7,000
(Being Bill of exchange duly accepted and returned by Manju)
Jan 05 Bank A/c Dr. 6,860
Discount A/c Dr. 140
(Being Bill of Exchange matured and duly met on maturity date)
Books of Manju
Journal
Debit Credit
₹ ₹
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
(Being Bill of exchange duly accepted and returned to Vishal)
Mar 08 Bills Payable A/ Dr. 7,000
To Bank A/c 7,000
(Being Bill of Exchange matured and duly met on maturity date)
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Working Notes:
Discount from Bank = ₹ 7, 000 × 12 × 2

100 12
(for 2 months) = ₹ 140
Cash Deposited by Bank = ₹ 7,000 – ₹ 140
= ₹ 6,860
4. On Feb 01, 2016, John purchased goods for ₹ 15,000 from Jimmi. He immediately made a payment of ₹ 5,000 by cheque and for the balance
accepted the bill of exchange drawn upon him by Jimmi. The bill of exchange was payable after 40 days. Five days before the maturity of the bill,
Jimmi sent the same to his bank for collection. The bank duly presented the bill to John on the due date who met the bill. The bank informed the
same to Jimmi.
Prepare John’s account in the books of Jimmi and Jimmi account in the books of John.
x
Books of Jimmi
Journal
Debit Credit
₹ ₹
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 from John for ₹ 5,000)
Feb 01 Bills Receivable A/c Dr. 10,000
To John A/c 10,000
(Being Bill of Exchange duly accepted and returned by John)
Mar 11 Bills Sent for Collection A/c Dr. 10,000
(Being Bills sent for collection to bank)
Mar 16 Bank A/c Dr. 10,000
To Bills Sent for Collection A/c 10,000
(Being bill duly met on maturity date)
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Books of Jimmi
John’s A/c
Dr. Cr.
Amount Amount
₹ ₹
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
Books of John
Journal
Debit Credit
₹ ₹
2016
Feb 01 Purchases A/c Dr. 15,000
To Jimmi A/c 15,0
(Being goods purchased from John)
Feb 01 Jimmi A/c Dr. 5,000
To Bank A/c 5,0 x
(Being cheque paid to Jimmy for ₹ 5,000)
Feb 01 Jimmi A/c Dr. 10,000
(Being Bill of Exchange duly accepted and returned by John)
Mar 16 Bills Payable A/c Dr. 10,000
To Bank A/c 10,0
(Being bill duly met on maturity date)
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Books of John
Jimmi’s A/c
Dr. Cr.
Amount Amount
₹ ₹
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
5. On Jan 15, 2015, Kartar Sold goods for ₹ 30,000 to Bhagwan and drew upon him three bills of exchanges of ₹ 10,000 each payable after one
month, two months and three months respectively. The first bill was retained by Kartar till its maturity. The second bill was endorsed by him in
favour of his creditor Ratna and the third bill was discounted by him immediately @ 6% p.a. All the bills were met by Bhagwan. Journalise the
above transactions in the books of Kartar and Bhagwan. Also prepare ledger accounts in the books of Kartar and Bhagwan.
Books of Kartar
Journal
Debit Credit
₹ ₹
2015
Jan 15 Bhagwan A/c Dr. 30,000
To Sales A/c 30,000
(Being goods sold to Bhagwan)
To Bhagwan A/c 30,000
(Being Bill of exchange duly accepted and returned by Bhagwan)
Jan 15 Ratna A/c Dr. 10,000
(Being ₹ 10,000 bill from Bhagwan endorsed to Ratna)
(Being ₹ 10,000 bill from Bhagwan discounted with bank)
(Being the third bill of ₹ 10,000 accepted by Bhagwan matured and duly met on maturity date) x
Sales A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Dec 31 To Balance c/d 30,000 Jan 15 By Bhagwan A/c 30,000
30,000 30,000
Bhagwan’s A/c
Dr. Cr.
Amount Amount
₹ ₹
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 A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Jan 15 To Bills Receivable A/c 10,000 Jan 01 By balance b/d 10,000
10,000 10,000
Bills Receivable A/c

Dr. Cr.
Amount Amount
₹ ₹
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
Feb 18 By Cash A/c 10,000
30,000 30,000
Cash A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Feb 18 To Bills Receivable A/c 10,000 Dec 31 By Balance c/d 10,000
10,000 10,000
Bank A/c
Dr.
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Cr.
Amount Amount
₹ ₹
2015 2015
Jan 15 To Bills Receivable A/c 9,850 Dec 31 By Balance c/d 9,850
9,850 9,850
Books of Bhagwan
Journal
Debit Credit
₹ ₹
2015
To Kartar A/c 30,000
(Being goods purchased from Kartar)
Jan 15 Kartar A/c Dr. 30,000
(Being three bills each of ₹ 10,000 each duly accepted and returned to Kartar)
Feb 18 Bills Payable A/c Dr. 10,000
To Bank A/c 10,000
(Being first of the three ₹ 10,000 bills matured and paid)
To Bank A/c 10,000
(Being second of the three ₹ 10,000 bills matured and paid)
To Bank A/c 10,000
(Being third of the three ₹ 10,000 bills matured paid)
Purchases A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Jan 15 To Kartar A/c 30,000 Dec 31 By Balance c/d 30,000
30,000 30,000
Kartar A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Jan 15 To Bills Payable A/c 30,000 Dec 31 By Purchases A/c 30,000
30,000 30,000
Bills Payable A/c

Dr. Cr.
Amount Amount
₹ ₹
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
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30,000
Cash A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Jan 01 To Balance b/d 10,000 Jan 15 By Bills Payable A/c 10,000
10,000 10,000
Bank A/c
Dr. Cr.
Amount Amount
₹ ₹
2015 2015
Jan 31 To Balance b/d 20,000 Mar 18 By Bills Payable A/c 10,000
Apr 18 By Bills Payable A/c 10,000
20,000 20,000
Working Notes:

100 12
= ₹ 9,850
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6. On Jan. 01, 2016 Arun sold goods for ₹ 30,000 to Sunil. 50% of the payment was made immediately by Sunil on which Arun allowed a cash
discount of 2%. For the balance Sunil drew a promissory note in favour of Arun payable after 20 days. Since, the date of maturity of bill was a
public holiday, Arun presented the bill on a day, as per the provisions of Negotiable Instrument Act which was met by Sunil. State the date on
which the bill was presented by Arun for payment and Jounalise the above transactions in the books of Arun and Sunil.
If the date of maturity of the bill is a business day then the maturity date would be
Jan 01, 2015 + 20 days + 3 days of grace = 24 Jan 2016.
However, if this day falls on a public holiday as described in the Negotiable Instruments Act, 1881, then the maturity date would be the preceding day. As
24 Jan 2016 is not a public holiday, the maturity date would be 24 Jan, 2016.
Books of Arun
Journal
Debit Credit
₹ ₹ x
2016
Jan 01 Sunil A/c Dr. 30,000
To Sales A/c 30,0
(Being goods sold to Sunil)
To Sunil A/c 15,0
(Being 50% of the payment received from Sunil with 2% discount)
To Sunil A/c 15,0
(Being Promissory note received from Sunil)
(Being the promissory note matured and duly paid by Sunil on the date of maturity)
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Books of Sunil
Journal
Debit Credit
₹ ₹
2016
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 A/c 300
(Being 50% of the payment paid to Arun with 2% discount received)
Jan 01 Arun A/c Dr. 15,000
(Being promissory note issued to Arun)
Jan 24 Bills Payable A/c Dr. 15,000
To Cash A/c 15,000
(Being the promissory note matured and duly paid to Sunil on the date of maturity)
Working Notes:
Cash Discount provided to Sunil = 6 2

₹ 15, 000 × ×

100 100
= ₹ 300
Cash paid by Sunil
= ₹ 15,000 – ₹ 300
= ₹ 14,700
7. Darshan sold goods for ₹ 40,000 to Varun on 8.1.2016 and drew upon him a bill of exchange payable after two months. Varun accepted the bill
and returned the same to Darshan. On the due date the bill was met by Varun. Record the necessary Journal entries in the books of Darshan and
x
Varun in the following circumstances.
● When the bill was retained by Darshan till the date of its maturity.
● When Darshan immediately discounted the bill @ 6% p.a. with his bank.
● When the bill was endorsed immediately by Darshan in favour of his creditor Suresh.
● When three days before its maturity, the bill was sent by Darshan to his bank for collection.
Case 1: When the bill was retained by Darshan till the date of its maturity:
Books of Darshan
Journal
Debit Credit
₹ ₹
2016
Jan 08 Varun A/c Dr. 40,000
To Sales A/c 40,000
(Being goods sold to Varun)
To Varun A/c 40,000
(Being Bill of Exchange duly accepted and returned by Varun)
Mar 11 Cash A/c Dr. 40,000
(Being the bill duly matured and paid on the date of maturity.)
Books of Varun
Journal
Debit Credit
₹ ₹
2016
To Varun A/c 40,000
(Being goods purchased from Darshan)
To Bills Payable A/c
40,000 (Being Bill of Exchange duly accepted and returned to Darshan)
Mar 11 Bills Payable A/c Dr.
40,000 To Cash A/c
40,000 (Being the Bill of Exchange matured and duly cleared on date of maturity)
Case 2: When Darshan immediately discounted the bill @ 6% p.a. with his bank:
Books of Darshan
Journal
Debit Credit
₹ ₹
2016
To Sales A/c 40,000
To Varun A/c 40,000
(Being the Bill of Exchange discounted from Bank)
Books of Varun
Journal
Debit Credit
₹ ₹
2016
To Varun A/c 40,0
x
(Being Bill of Exchange duly accepted and returned to Darshan)
To Bank A/c 40,0
(Being the Bill of Exchange matured and duly cleared on date of maturity)
Working Notes:
100 12
= ₹ 39,600
Case 3: When the bill was endorsed immediately by Darshan in favour of his creditor Suresh:
Books of Darshan
Journal
Date Particulars
Debit Credit 2016
L.F. Amount Amount
₹ ₹
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 Bill of Exchange duly accepted and returned by Varun)
Jan 08 Suresh A/c Dr.
40,000 To Bills Receivable A/c
40,000 (Being the Bill of Exchange endorsed in favour of Suresh)
Books of Varun
Journal
Debit Credit
₹ ₹
2016
To Varun A/c 40,000
To Cash A/c 40,000
Case 4: When three days before its maturity, the bill was sent by Darshan to his bank for collection:
Books of Darshan
Journal
Debit Credit
₹ ₹
2016
To Sales A/c 40,000
To Varun A/c 40,000
(Being the Bill of Exchange sent for collection to bank)
x
(Being the Bill of Exchange matured and duly collected on date of maturity)
Books of Varun
Journal
Debit Credit
₹ ₹
2016
To Varun A/c 40,000
To Bank A/c 40,000
8. Bansal Traders allow a trade discount of 10% on the list price of the goods purchased from them. Mohan traders, who runs a retail shop made
the following purchases from Bansal Traders.
Date Amount
₹
Dec. 21, 2016 1,000
Dec. 26, 2016 1,200
Dec. 18 28, 2016 2,000
Dec. 31, 2016 5,000
For all the purchases Mohan Traders drew promissory note in favour of Bansal Traders payable after 30 days. The promissory note for the sale of
Dec. 21, 2016 was retained by Bansal Traders with them till the date of its maturity. The promissory note drawn on 26.12.2016 was discounted by
Bansal Traders from their bank at 12% p.a. The promissory note drawn on Dec. 28, 2015 was endorsed by Bansal Traders in favour of their creditor
Dream Soaps in full settlement of a purchase amounting to ₹ 1,900. On 25.1.2016 Bansal Traders sent the promissory note drawn on Dec. 31, 2016
to their bank for collection. All the promissory notes were met by Mohan Traders. Record the necessary journal entries for the above transactions in
the books of Bansal Traders and Mohan Traders and prepare Mohan Traders account in the books of Bansal Traders and Bansal Traders account in
the books of Mohan Traders.
Note: Please note that there is/was a typo in the text book where in the date Dec. 28 is printed as Dec. 18
Books of Bansal Traders
Journal
Debit Credit
₹ ₹
2016
Dec 21 Mohan Traders A/c Dr. 900
To Sales A/c 900
(Being goods worth ₹ 1,000 sold to Mohan Traders 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 due after 30 days)
Dec 26 Mohan Traders A/c Dr. 1,080
To Sales A/c 1,080
Dec 26 Bills Receivable A/c Dr. 1,080
To Mohan Traders A/c 1,080
Dec 26 Bank A/c Dr. 1,069
Discount A/c Dr. 11
(Being promissory note for ₹ 1,080 discounted @12% p.a. from bank)
To Sales A/c 1,800
Dec 28 Dream Soaps A/c Dr. 1,900
x
To Discount A/c 100
(Being promissory note worth ₹ 1,800 endorsed to Dream Soaps in full settlement of ₹ 1,900 worth of credit at a
discount of ₹ 100)
To Sales A/c 4,500
2017
Jan 23 Cash A/c Dr. 900
To Bills Receivable A/c 900
(Being promissory note for ₹ 900 matured and realized)
Jan 25 Bills Sent for Collection A/c Dr. 4,500
(Being promissory note for ₹ 4,500 sent to bank for collection)
(Being promissory note for ₹ 4,500 matured and realised)
Mohan Traders A/c

Dr. Cr.
Amount Amount
₹ ₹
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
8,280 8,280
Books of Bansal Traders

Journal
Debit Credit
₹ ₹
2016
Dec 21 Purchases A/c Dr. 900
To Bansal Traders A/c 900
(Being goods worth ₹ 1,000 purchased from Mohan Traders at 10% trade discount)
Dec 21 Bansal Traders A/c Dr. 900
To Bills Payable A/c 900
(Being promissory note for ₹ 900 issued to Bansal Traders)
Dec 26 Purchases A/c Dr. 1,080
To Bansal Traders A/c 1,080
Dec 26 Bansal Traders A/c Dr. 1,080
(Being promissory note for ₹ 1,080 issued to Bansal Traders)
2017
Jan 23 Bills Payable A/c Dr. 900
To Cash A/c 900 x
(Being promissory note worth ₹ 900 discharged upon maturity, by cash)
To Bank A/c 1,080
(Being promissory note worth ₹ 1,080 discharged upon maturity, through bank)
To Cash A/c 1,800
(Being promissory note worth ₹ 1,800 discharged upon maturity, by cash)
To Bank A/c 4,500
(Being promissory note worth ₹ 4,500 discharged upon maturity, through bank)
Mohan Traders A/c

Dr. Cr.
Amount Amount
₹ ₹
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
8,280 8,280
Working Notes:
Discounted
Amount Discount Discount
Date Price
₹ Calculation ₹
₹
2015
Dec 21 1,000 = ₹ 1, 000 × 10
100 = 1,000 – 100

100 = 900
Dec 26 1,200 = ₹ 1, 200 × 10
120 = 1,200 – 120

100
= 1,080
Dec 28 2,000 = ₹ 2, 000 × 10
200 = 2,000 – 200

100
= 1,800
Dec 31 5,000 = ₹ 5, 000 × 10
500 = 5,000 – 500

100
= 4,500
100 12
(for 30 days) = ₹ 11
= ₹ 1,069
9. Narayanan purchased goods for ₹ 25,000 from Ravinderan on Feb. 01, 2016. Ravinderan drew upon Narayanan a bill of exchange for the same
amount payable after 30 days. On the due date Narayanan dishonoured his acceptance.
Pass the necessary journal entries in the books of Ravinderan and Narayanan in following cases:
● When the bill was retained by Ravinderan with him till the date of its maturity.
● When the bill was discounted by Ravinderan immediately with his bank @ 6% p.a.
● When the bill was endorsed to his creditor Ganeshan.
● When the bill was sent by Ravinderan to his bank for collection a few days before it maturity.
Case 1:When the bill was retained by Ravinderan with him till the date of its maturity:
Books of Ravinder
Journal
Debit Credit
₹ ₹
2016
Feb 01 Narayanan A/c Dr. 25,000
To Sales A/c 25,000
(Being goods sold to Narayanan)
To Narayanan A/c 25,000
(Being Bill of Exchange drawn upon Narayanan duly accepted
by him and returned)
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Mar 06 Narayanan A/c Dr.

25,000 (Being Bill of Exchange dishounoured by Narayanan and
liability of the debtor is restored)
x
Books of Narayanan
Journal
Debit Credit
₹ ₹
2016
To Ravinder A/c 25,000
(Being goods purchased from Narayanan)
Feb 01 Ravinder A/c Dr. 25,000
(Being Bill of Exchange duly accepted and returned to Ravinder)
(Being Bill of Exchange dishounoured and liability to the creditor is restored)
Case 2: When the bill was discounted by Ravinderan immediately with his bank @ 6% p.a:
Books of Ravinder
Journal
Debit Credit
₹ ₹
2016
To Sales A/c 25,000
(Being Bill of Exchange drawn upon Narayanan duly accepted by
him and returned)
(Being Bill of Exchange discounted from bank @6% p.a. for 30 days)
Mar 06 Narayanan A/c Dr. 25,000
To Bank A/c
25,000 (Being Bill of Exchange dishounoured by Narayanan
and liability of the debtor is restored)
Books of Narayanan
Journal
Debit Credit
₹ ₹
2016
Working Notes:
100 365
(for 30 days) = ₹ 123
= ₹ 24,877
Case 3: When the bill was endorsed to his creditor Ganeshan:
Books of Ravinder
Journal x
Debit Credit
₹ ₹
2016
To Sales A/c 25,000
(Being Bill of Exchange drawn upon Narayanan duly accepted by
him and returned)
Feb 01 Ganesan A/c Dr. 25,000
To Bills Receivable A/c
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25,000 (Being Bill of Exchange endorsed in favour of Ganesan)

Mar 06 Narayanan A/c Dr.
25,000 To Ganesan A/c
25,000 (Being Bill of Exchange dishounoured by Narayanan
and liability of the debtor and creditor are restored)
Books of Narayanan
Journal
Debit Credit
₹ ₹
2016
Case 4: When the bill was sent by Ravinderan to his bank for collection a few days before it maturity:
Books of Ravinder
Journal
Debit Credit
₹ ₹
2016
Feb 01 Narayanan A/c Dr. 25,000 x
To Sales A/c 25,000
(Being Bill of Exchange drawn upon Narayanan duly accepted by him and returned)
(Being Bill of Exchange sent to Bank for Collection)
Mar 06 Narayanan A/c Dr. 25,000
To Ganesan A/c 25,000
(Being Bill of Exchange dishounoured by Narayanan and liability of the debtor and creditor are restored)
Books of Narayanan
Journal
Debit Credit
₹ ₹
2016
Feb 01 Purchases A/c 25,000
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10. Ravi sold goods for ₹ 40,000 to Sudershan on Feb 13, 2016. He drew four bills of exchange upon Sudershan. The first bill was for ₹ 5,000
payable after one month. The second bill was for ₹ 10,000 payable after 40 days; the third bill was for ₹ 12,000 payable after three months and
fourth bill was for the balance amount payable after 19 days. Sudershan accepted all the bills and returned the same to Ravi. Ravi discounted the
first bill with his bank at 6% p.a. He endorsed the second bill to his creditor Mustaq for the full settlement of a debt of ₹ 10,200. The third bill was
kept by Ravi with him till the date of maturity. Five days before the maturity of the fourth bill, Ravi sent the bill to his bank for collection. All the
four bills were dishounoured by Sudarshan on maturity. Sudershan settled Ravi’s claim in cash three days after the dishonour of each bill along
with interest @ 12% p.a. for the terms of the bills.
You are requested to record the necessary journal entries in the books to Ravi, Sudershan, Mustaq and bank for the above transaction. Also prepare
Sudershan’s account and Mustaq’s account in the books of Ravi.
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Books of Ravi
Journal
Debit Credit
₹ ₹
2016
Feb 13 Sudarshan A/c Dr. 40,000
To Sales A/c 40,000
(Being goods sold to Ravi on credit)
To Ravi A/c 40,000
(Being four Bills of exchange worth each of ₹ 5,000, ₹ 10,000, ₹ 12,000 and ₹ 13,000 draw upon Ravi duly accepted by
him and returned.)
Discount A/c Dr. 25
(Being Bill of Exchange worth of ₹ 5,000 discounted with the bank @6% p.a. for one month)
Feb 13 Mustaq A/c Dr. 10,200
To Discount Received A/c 200
(Being Bill of Exchange worth of ₹ 10,200 endorsed in favour of Mustaq to settle an amount of ₹ 10,200)
(Being Bill of Exchange for ₹ 13,000, due for maturity in 5 days, sent to bank for collection)
Mar 07 Sudarsan A/c Dr. 13,000
(Being Bill of Exchange worth of ₹ 13,000 dishonoured)
Mar 07 Sudarsan A/c Dr. 81
To Interest A/c 81
(Being interest on dishonoured Bill of Exchange worth of ₹ 13,000 @12% p.a. for 19 days)
To Sudarshan A/c 13,081
(Being cash paid by Sudarshan in lieu of the dishonoured Bill of Exchange worth of ₹ 13,000 + interest)
To Bank A/c 5,000
(Being Bill of Exchange worth of ₹ 5,000 dishonoured)
To Interest A/c 50
(Being interest on dishonoured Bill of Exchange worth of ₹ 5,000 @12% p.a. for one month)
Discount Received A/c Dr. 200
To Mushtaq A/c 10,200
(Being Bill of Exchange worth of ₹ 10,000 dishonoured, the liability of the debtor and creditor are restored)
To Interest A/c 132
(Being interest on dishonoured Bill of Exchange worth of ₹ 10,000 @12% p.a. for 40 days)
Apr 01 Cash A/c Dr. 10,132
May 16 Sudarsan A/c Dr. 12,000
(Being Bill of Exchange worth of ₹ 12,000 dishonoured, the liability of the debtor is restored)
May 16 Sudarsan A/c Dr. 360
To Interest A/c 360
(Being interest on dishonoured Bill of Exchange worth of ₹ 12,000 @12% p.a. for 3 months)
x
Sudarshan A/c
Dr. Cr.
Amount Amount
₹ ₹
2016 2016
Feb 13 To Sales A/c 40,000 Feb 13 By Bills Receivable A/c 40,000
Mar 07 To Bills Sent for 13,000 Mar 10 By Cash A/c 13,081
Collection A/c Mar 19 By Cash A/c 5,050
Mar 07 To Interest A/c 81 Apr 01 By Cash A/c 10,132
Mar 16 To Bank A/c 5,000 May 19 By Cash A/c 12,360
Mar 16 To Interest A/c 50
Mar 28 To Mushtaq A/c 10,000
May 16 To Bills Receivable A/c 12,000
80,623 80,623
Mushtaq A/c
Dr. Cr.
Amount Amount
₹ ₹
2016 2015
Feb 13 To Bills Receivable A/c 10,000 Feb 28 By Sudarshan A/c 10,000
Feb 13 To Discount Received A/c 200 Mar 28 By Discount Received A/c 200
10,200 10,200
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Books of Ravi
Journal
Debit Credit
₹ ₹
2016
To Ravi A/c 40,000
(Being goods purchased from Ravi on credit)
Feb 13 Ravi A/c Dr. 40,000
(Being four bills worth of ₹ 5000 payable after one month, ₹ 10,000 payable after 40 days, ₹ 12,000 payable after 3
months and ₹ 13,000 payable after 19 days are accepted and returned to Ravi)
Mar 07 Bills Receivable A/c Dr. 13,000
To Ravi A/c 13,000
(Being bill worth of ₹ 13,000 dishonoured and the liability to the creditor is restored)
Mar 07 Interest A/c Dr. 81 x
To Ravi A/c 81
(Being interest to be paid for the dishounoured bill worth of ₹ 13,000)
Mar 10 Ravi A/c Dr. 13,081
To Cash A/c 13,081
(Being paid to Ravi to repay the dishonoured bill worth of ₹ 13,000 + interest)
To Ravi A/c 5,000
Mar 16 Interest A/c Dr. 50
To Ravi A/c 50
Mar 19 Ravi A/c Dr. 5,050
To Cash A/c 5,050
To Ravi A/c 10,000
To Ravi A/c 132
Apr 01 Ravi A/c Dr. 10,132
To Cash A/c 10,132
May 16 Bills Receivable A/c Dr. 12,000
To Ravi A/c 12,000
May 16 Interest A/c Dr. 360
To Ravi A/c 360
May 19 Ravi A/c Dr. 12,360
To Cash A/c 12,360
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Books of Mushtaq
Journal
Debit Credit
₹ ₹
2016
Discount Allowed A/c Dr. 200
To Ravi A/c 10,200
(Being Bill of Exchange received from Ravi and discount provided)
Feb 13 Ravi A/c Dr. 10,200
To Discount Allowed A/c 200
(Being Bill of Exchange dishonoured and the liability of the debtor is restored)
Books of Bank
Journal
Debit Credit x
₹ ₹
2016
(Being Bill of Exchange received from Ravi for collection)
(Being Bill of Exchange dishonoured)
Working Notes:
Discount with Bank = ₹ 5, 000 × 6 × 1
100 12
(for one month) = ₹ 25
= ₹ 4,975
Interest on dihounoured bill = ₹ 13, 000 × 12 × 19
100 365
(worth of ₹ 13,000) = ₹ 81
100 12
(worth of ₹ 5,000) = ₹ 50
100 365
(worth of ₹ 10,000) = ₹ 132
100 12
(worth of ₹ 12,000) = ₹ 360
11. On Jan 01, 2016 Neha sold goods for ₹ 20,000 to Muskan and drew upon her a bill of exchange payable after two months. One month before
the maturity of the bill Muskan approached Neha to accept the payment against the bill at a rebate @ 12% p.a. Neha agreed to the request of
Muskan and Muskan retired the bill under the agreed rate of rebate.
Journalise the above transaction in the books of Neha and Muskan.
Books of Neha
Journal
Debit Credit
₹ ₹
2016
Jan 01 Muskan A/c Dr. 20,000
To Sales A/c 20,000
(Being goods sold to Muskan)
To Muskan A/c 20,000
(Being Bill of Exchange drawn on Muskan, duly accepted and returned by Muskan)
(Being cash payment received from Muskan against the bill at a rebate of 12% p.a. and the bill is retired upon mutual
acceptance)
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Books of Muskan
Journal
Debit Credit
₹ ₹
2016
To Neha A/c 20,000
(Being goods purchased from Neha)
Jan 01 Neha A/c Dr. 20,000
(Being Bill of Exchange for ₹ 20,000 duly accepted and returned to Neha)
Feb 04 Bills Payable A/c Dr. 20,000 x
To Cash A/c 19,800
(Being cash paid to Neha against the bill at a rebate of 12% p.a. and the bill is retired upon mutual acceptance)
Working Notes:
Rebate on the bill = ₹ 20, 000 × 12 × 1

100 12
Cash Paid by Neha = ₹ 20,000 – ₹ 200
(After rebate) = ₹ 19,800
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12. On Jan 15, 2016 Raghu sold goods worth ₹ 35,000 to Devendra and drew upto the latter three bills of exchanges. The first bill was for ₹ 5,000
payable after one month, the second bill was for ₹ 20,000 payable after three months and third bill for balance amount for 4 months. Raghu
endorsed the first bill in favour of his creditor Dewan in full settlement of a debt of ₹ 5,200. The second bill was discounted by Raghu @ 6 % p.a.
and the third bill was retained by Raghu till the date of maturity. Devendra dishonoured the bill on maturity and the bank paid ₹ 30 as noting
charges. Four days before the maturity of the third bill Raghu, sent the same for collection to his bank. The third bill was also dishonored by
Devendra and the bank paid Rs.200 as noting charges. Five days after the dishonour of the bill Devendra paid the entire amount due to Raghu
along with interest ₹ 1,000 for this purpose Devendra obtained a short term loan from his bank.
You are requested to record the necessary journal entries in the books of Raghu, Devendra and Dewan and also prepare Devendra’s account in
Raghu’s books and Raghu’s account in Devendra’s account.
Books of Raghu
Journal
Debit Credit
₹ ₹
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 Bills of Exchange worth of ₹ 5,000 for one month, ₹ 20,000 for three months,
₹ 10,000 for four months, duly accepted and returned by Devendra)
Jan 15 Dewan A/c Dr.
5,000 To Discount Received A/c
200 (Being Bill of Exchange worth of ₹ 5,000 endorsed to the creditor Dewan for a discount of
₹ 200)
Jan 15 Bank A/c Dr.
19,700 Discount Allowed A/c Dr.
300 To Bills Receivable A/c
20,000 (Being Bill of Exchange worth of ₹ 20,000 discounted from bank @ 6% p.a. for 3 months)
Apr 18 Devendra A/c Dr.
20,030 To Bank A/c
20,030 (Being Bill of Exchange worth of ₹ 20,000 dishounoured by Devendra and the bank paid
₹ 30 as noting charges)
x
May 14 Bills Sent for Collection A/c Dr.
15,000 (Being Bill of Exchange worth of ₹ 15,000 sent for collection to Bank)
May 18 Devendra A/c Dr.
15,200 To Bills Sent for Collection A/c
15,000 To Bank A/c
200 (Being Bill of Exchange worth of ₹ 15,000 dishounoured by Devendra and the bank paid
₹ 200 as noting charges)
May 23 Devendra A/c Dr.
1,000 To Interest A/c
1,000 (Being interest agreed to be paid by Devendra after dishouring of the bills)
May 23 Cash A/c Dr.
31,230 To Devendra A/c
31,230 (Being cash paid by Devendra in full settlement of the account)
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Devendra’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2016 2015
Apr 15 To Bank A/c 20,030 May 23 By Cash A/c 31,230
May 18 To Bills Sent for 10,000
Collection A/c
May 18 To Bank A/c 200
May 23 To Intest A/c 1,000
66,230 66,230
Books of Devendra
Journal
Debit Credit
₹ ₹
2016
To Raghu A/c 35,000
(Being purchased from Raghu)
Jan 15 Raghu A/c Dr. 35,000
(Being bills worth of ₹ 5,000 for one month, ₹ 20,000 for three months and ₹ 10,000 for one month duly accepted
and returned to Raghu)
To Cash A/c 5,000
(Being bill worth of ₹ 5,000 matured and discharged on maturity date) x
Noting Charges A/c Dr. 30
To Raghu A/c 20,030
(Being bill worth of ₹ 20,000 dishonoured and noting charges ₹ 30)
May 18 Bills Payable A/c Dr. 10,000
To Raghu A/c 10,200
(Being bill worth of ₹ 10,000 dishonoured and noting charges ₹ 200)
May 23 Interest A/c Dr. 1,000
To Raghu A/c 1,000
(Being interest promised to pay to Raghu due to dishonouring of the bills)
May 23 Cash A/c Dr. 31,230
To Bank Loan A/c 31,230
(Being loan taken from bank to settle the bills owed to Raghu)
May 23 Raghu A/c Dr. 31,230
To Cash A/c 31,230
(Being the bills settled through cash payment)
Raghu’s A/c
Dr. Cr.
Amount Amount
₹ ₹
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 23 By Interest A/c 200
66,230 66,230
Books of Dewan
Journal
Debit Credit
₹ ₹
2016
To Raghu A/c 5,200
(Being credit worth of ₹ 5,200 is discounted for ₹ 200 to Raghu)
(Being bill worth of ₹ 5,000 matured and realized)
Working Notes:

100 12
= ₹ 19,700
13. Viaml Vimal purchased goods ₹ 25,000 from Kamal on Jan 15, 2016 and accepted a bill of exchange drawn upon him by Kamal payable after
two months. On the date of the maturity the bill was duly presented for payment. Vimal dishonoured the bill. Record the necessary journal entries
in the books of Kamal and Vimal when
● The bill was retained by Kamal till the date of its maturity.
● The bill was immediately discounted by Kamal with his bank @ 6% p.a.
● The bill was endorsed by Kamal in favour of his creditor Sharad.
● Five days before its maturity the bill was sent by Kamal to his bank for collection.
Case 1: The bill was retained by Kamal till the date of its maturity:
Books of Kamal
Journal Entries
Debit Credit
₹ ₹
2016
x
Jan 15 Vimal A/c Dr. 25,000
To Sales A/c 25,0
(Being goods sold to Vimal)
To Vimal A/c 25,0
(Being Bill of Exchange drawn on Vimal and duly accepted and returned by him)
Mar 18 Vimal A/c Dr. 25,000
(Being Bill of Exchange dishonored by Vimal and the liability of the acceptor is restored)
Books of Vimal
Journal Entries
Debit Credit
₹ ₹
2016
To Kamal A/c 25,000
(Being goods purchased from Kamal)
Jan 15 Kamal A/c Dr. 25,000
(Being bill worth of ₹ 25,000 duly accepted and returned to Kamal)
To Kamal A/c 25,000
(Being bill dishonoured and the liability to the creditor is restored)
Case 2: The bill was immediately discounted by Kamal with his bank @ 6% p.a:
Books of Kamal
Journal Entries
Debit Credit
₹ ₹
2016
To Sales A/c 25,000
To Vimal A/c 25,000
Bills Discounting Charges A/c Dr. 250
(Being Bill of Exchange discounted by bank @6% p.a. for 2 months)
To Bank A/c 25,000
Books of Vimal
Journal Entries
Debit Credit
₹ ₹
2016
To Kamal A/c 25,000
To Kamal A/c 25,000
Working Notes:
x
100 12
= ₹ 24,750
Case 3: The bill was endorsed by Kamal in favour of his creditor Sharad:
Books of Kamal
Journal Entries
Debit Credit
₹ ₹
2016
To Sales A/c 25,000
To Vimal A/c 25,000
Jan 15 Sharad A/c Dr. 25,000
To Bils Receivable A/c 25,000
(Being Bill of Exchange endorsed in favour of Sharad)
To Sharad A/c 25,000
Books of Vimal
Journal Entries
Debit Credit
₹ ₹
2016
To Kamal A/c 25,000
To Kamal A/c 25,000
Case 4: Five days before its maturity the bill was sent by Kamal to his bank for collection:
Books of Kamal
Journal Entries
Debit Credit
₹ ₹
2016
To Sales A/c 25,000
To Vimal A/c 25,000
Jan 15 Bills Sent for Collection A/c Dr. 25,000
To Bils Receivable A/c 25,000
(Being bill sent for collection to bank)
Books of Vimal
Journal Entries
Debit Credit
x
₹ ₹
2016
To Kamal A/c 25,0
To Kamal A/c 25,0
14. Abdulla sold goods to Tahir on Jan 17, 2017 for ₹ 18,000. He drew a bill of exchange for the same amount on Tahir for 45 days. On the same
date Tahir accepted the bill and returned it to Abdulla. On the due date, Abdulla presented the bill to Tahir which was dishonoured. Abdulla paid
Rs.40 as noting charges. Five days after the dishonour of his acceptance Tahir settled his debt by making a payment of ₹ 18,700 including interest
and noting charges. x
Record the necessary journal entries in the books of Abdulla and Tahir. Also prepare Tahir’s account in the books of Abdulla and Abdulla’s account
in the books of Tahir.
Books of Abdulla
Journal Entries
Debit Credit
₹ ₹
2017
Jan 17 Tahir A/c Dr. 18,000
To Sales A/c 18,000
(Being goods sold to Tahir)
To Tahir A/c 18,000
(Being Bill of Exchange drawn on Tahir and duly accepted and returned by him)
Mar 06 Tahir A/c Dr. 18,040
To Cash A/c 40
(Being Bill of Exchange dishonoured by Tahir and ₹ 40 noting changes are charged to him)
Mar 06 Tahir A/c Dr. 660
To Interest A/c 660
(Being interest charged to Tahir on account of his dishonouring the bill)
To Tahir A/c 18,700
(Being the liability settled by Tahir by paying cash)
Tahir’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Mar 06 To Bills Receivable A/c 18,000 Mar 11 By Cash A/c 18,700
Mar 06 To Cash A/c 40
36,700 36,700
Books of Tahir
Journal Entries
Debit Credit
₹ ₹
2017
To Abdulla A/c 18,000
(Being goods purchased from Abdulla)
Jan 17 Abdulla A/c Dr. 18,000
(Being Bill of Exchange duly accepted and returned to Abdulla)
To Abdulla A/c 18,040
(Being Bill of Exchange dishonoured and subjected noting charges of ₹ 40)
To Abdulla A/c 660
(Being interest due to Abdulla on account of bill dishonoured)
Mar 11 Abdulla A/c Dr. 18,700
To Cash A/c 18,700
(Being the liability settled through cash)
Abdulla/s A/c
Dr. Cr.
Amount Amount
₹ ₹ x
2017 2017
Jan 17 To Bils Payable A/c 18,000 Jan 17 By Purchases A/c 18,0
Mar 11 To Cash A/c 18,700 Mar 06 By Bills Payable A/c 18,0
Mar 06 By Noting Charges A/c
Mar 06 By Interest A/c 6
36,700 36,7
15. Asha sold goods worth ₹ 19,000 to Nisha on March 02, 2017. ₹ 4,000 were paid by Nisha immediately and for the balance she accepted a bill of
exchange drawn upon her by Asha payable after three months. Asha discounted the bill immediately with her bank. On the due date Nisha
dishonoured the bill and the bank paid ₹ 30 as noting charges.
Record the necessary journal entries in the books of Asha and Nisha.
Note: The bank discount rate is not provided in the question. So, it is assumed that the bill is discounted @12% p.a.
Books of Asha
Journal Entries
Debit Credit
₹ ₹
2017
Mar 02 Nisha A/c Dr. 19,000
To Sales A/c 19,000
(Being goods sold to Nisha)
Bills Receivable A/c Dr. 15,000
To Nisha A/c 19,000
(Being cash paid by Nisha to Paritiall clear the debt and for the rest of the amount bill drawn and dule accepted and
returned by Nisha)
Discount Charges A/c Dr. 450
(Being the bill discounted with the back @12% p.a. for 3 months)
Jun 05 Nisha A/c Dr. 15,030
To Bank A/c 15,030
(Being the bill dishonoured by Nish and the noting charges of ₹ 30 were paid by the bank)
Books of Nisha
Journal Entries
Debit Credit
₹ ₹
2017
Mar 02 Purchase A/c Dr. 19,000
To Asha A/c 19,000
(Being goods purchased from Asha)
Mar 02 Asha A/c Dr. 19,000
To Cash A/c 4,000
(Being the liability is cleared partially by paying ₹ 4,000 in cash and the bill is accepted and returned for the rest of the
amount)
Jun 02 Bills Payable A/c Dr. 15,000
To Asha A/c 15,030
(Being the bill dishonoured and noting charges ₹ 30 were paid)
Working Notes:

100 12
= ₹ 14,550
16. On Feb. 02, 2017, Verma purchased from Sharma goods for ₹ 17,500. Verma paid ₹ 2,500 immediately and for the balance gave a promissory
note to Sharma payable after 60 days. Sharma immediately endorsed the promissory note in favour of his creditor Gupta for the full settlement of
a debt of ₹ 15,400. On the due date of the bill Gupta presented the bill to Verma which the latter dishonoured and Gupta paid ₹ 50 noting charges.
On the same date Gupta informed Sharma about the dishonour of the bill. Sharma settled his debt to Gupta by cheque for Rs.15,500 which includes
noting charges and interest. Verma settled Sharma’s claim by cheque for the same amount.
Record the necessary journal entries is the books of Sharma, Gupta and Verma for the above transaction and prepare Verma’s and Gupta’s accounts
in the books of Sharma. Sharma’s account in the books of Verma. And also Sharma’s account in the books of Gupta.
x
Books of Sharma
Journal Entries
Debit Credit
₹ ₹
2017
Feb 02 Verma A/c Dr. 17,500
To Sales A/c 17,500
(Being goods sold to Verma)
Bills Receivable A/c Dr. 15,000
To Verma A/c 17,500
(Being cash ₹ 2,500 paid by Verma and bill is drawn for the rest of the amount note is provided by Verma)
Feb 02 Gupta A/c Dr. 15,400
(Being promissory note for ₹ 15,000 is endorsed in favour of Gupta, to settle a liability of ₹ 15,400, for a discount of
₹ 400)
Apr 06 Verma A/c Dr. 15,050
Discount Received A/c Dr. 400
To Gupta A/c 15,450
(Being promissory note dishonoured on maturity date and noting charges of ₹ 50 are applied. The liability to the
creditor and from the debtor are restored.)
Apr 06 Interest A/c Dr. 50
To Gupta A/c 50
(Being interest credited to Gupta’s account due to the note being dishonoured on the maturity date.)
Apr 06 Gupta A/c Dr. 15,500
To Bank A/c 15,500
(Being Sharma’s liability settled by paying through cheque)
To Verma A/c 15,050
(Being Verma settled the account through cheque)
Verma’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Feb 02 To Sales A/c 17,500 Feb 02 By Cash A/c 2,500
Apr 06 To Noting Charges A/c 15,050 Feb 02 By Bills Receivable A/c 15,000
Apr 06 By Bank A/c 15,050
32,550 32,550
Gupta’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Feb 02 To Bills Receivable A/c 15,000 Feb 02 By Balance b/d 15,400
Feb 02 To Discount Received A/c 400 Apr 02 By Verma A/c 15,050
Apr 06 To Bank A/c 15,500 Apr 06 By Discount Received A/c 400
Apr 06 By Interest A/c 50
30,900 30,900
Books of Verma
Journal Entries
Debit Credit
Date Particulars L.F. Amount Amoun
₹ ₹
2017
To Sharma A/c 17,5
(Being goods purchased from Verma) x
Feb 02 Sharma A/c Dr. 17,500
To Cash A/c 2,5
(Being cash paid to partially pay for the goods and promissory note is provided for the rest of the amount)
To Sharma A/c 15,0
(Being promissory note dishonoured and the liability is restored)
Apr 06 Sharma A/c Dr. 15,050
To Bank A/c 15,0
(Being payment is made through cheque to discharge the liability)
Sharma A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Feb 02 To Cash A/c 2,500 Feb 02 By Purchases A/c 17,500
Feb 02 To Bills Payable A/c 15,000 Apr 06 By Bills Payable A/c 15,000
Apr 06 To Bank A/c 15,050 Apr 06 By Noting Charges A/c 50
32,550 32,550
Books of Verma
Journal Entries
Debit Credit
₹ ₹
2017
To Sharma A/c 15,400
(Being promissory note for ₹ 15,000 endorsed by Sharma to settle the debt of ₹ 15,400, with ₹ 400 discount allowed)
Apr 06 Sharma A/c Dr. 15,450
To Noting Charges A/c 50
To Discount Allowed A/c 400
(Being promisory note dishonoured and noting charges ₹ 50 paid)
Apr 06 Sharma A/c Dr. 50
To Interest A/c 50
(Being interest charged to Sharma due to the dishonouring of the promissory note)
To Sharma A/c 15,500
(Being the liability is settled through cheque)
Sharma A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Feb 02 To Balance b/d 15,400 Feb 02 By Bills Receivable A/c 15,000
Feb 06 To Bills Receivable A/c 15,000 Feb 02 By Discount Allowed A/c 400
Feb 06 To Discount Allowed A/c 400 Feb 06 By Bank A/c 15,500
Feb 06 To Noting Charges A/c 50
Feb 06 To Interest A/c 50
30,900 30,900
17. Lilly sold goods to Methew on 1.3.2017 for ₹ 12,000 and drew upon Methew a bill of exchange for the same amount payable after two months.
Lilly immediately discounted the bill with her bank at 9% p.a. The maturity date of the bill was a non business day (holiday), therefore, Lilly had to
present the bill as per the provisions of the Indian Instruments Act.1881. The bill was dishonoured by Methew and Lilly paid ₹ 45 as noting charges.
Methew settled the claim of Lilly five days after the disonour of the bill by a cheque, whch includes interest @ 12% for the term of the bill.
Journalise the above transactions in the books of Lilly and Methew and prepare Mathew’s account in the books of Lilly and Lilly’s account in the
books of Mathew.
Books of Lily
Journal Entries
Debit Credit
₹ ₹
2017
Mar 01 Mathew A/c Dr. 12,000
To Sales A/c 12,0
(Being goods sold to Mathew)
To Mathew A/c 12,0
(Being Bill of Exchange was drawn on Mathew and accepted and returned by him)
(Being the bill discounted with the bank)
May 03 Mathew A/c Dr. 12,045
To Bank A/c 12,0 x
(Being the bill dishonoured by Mathew and ₹ 45 paid as noting charges)
May 08 Mathew A/c Dr. 240
To Interest A/c 2
(Being interest paid by Mathew on account of dishonouring of the bill)
May 08 Bank A/c Dr. 12,285
To Mathew A/c 12,2
(Being the liability is settled by Mathew by paying through cheque)
Mathew’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Mar 01 To Sales A/c 12,000 Mar 01 By Bills Receivable A/c 12,000
May 03 To Bank A/c 12,045 Mar 08 By Bank A/c 12,285
May 08 To Interest A/c 240
24,285 24,285
Books of Mathew
Journal Entries
Debit Credit
₹ ₹
2017
Mar 01 Purchases A/c Dr. 12,000
To Lilly A/c 12,000
(Being goods purchased from Lilly)
Mar 01 Lilly A/c Dr. 12,000
(Being bill of exchange accepted and returned to Lilly)
To Mathew A/c 12,045
(Being the bill dishonoured and ₹ 45 noting charges are incurred and hence the liability to the creditor is restored)
May 08 Interest A/c Dr. 12,000
To Mathew A/c 240
(Being the interest charged to Lilly on account of dishonouring of the bill)
May 08 Mathew A/c Dr. 12,285
To Bank A/c 12,285
(Being the liability settled by paying through cheque)
Lilly’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Mar 01 To Bills Payable A/c 12,000 Mar 01 By Purchases A/c 12,000
Mar 08 To Bank A/c 12,285 May 03 By Bills Payable A/c 12,000
Mar 03 By Noting Charges A/c 45
24,285 24,285
Working Notes:
Maturity date of the bill = Mar 01, 2017 + 2 months + 3 days of grace
= May 04, 2017
As May 04, 2017 is a public holiday (it is giving in the problem that “The maturity date of the bill was a non business day (holiday)”), the maturity date would
be the day preceding this day i.e. May 03, 2015. (one day before May 04, 2017)
100 12
= ₹ 11,820
Interest paid by Mathew due to dishonour of the bill (for 2 months)
Interest Paid = ₹ 12, 000 × 12 × 2
x
100 12
= ₹ 240
18. Kapil purchased goods for ₹ 21,000 from Gaurav on 1.2.2017 and accepted a bill of exchange drawn by Gaurav for the same amount. The bill
was payable after one month. On 25.2.2017 Gaurav sent the bill to his bank for collection. The bill was duly presented by the bank. Kapil
dishonoured the bill and the bank paid ₹ 100 as noting charges.
Record the necessary journal entries for the above transactions in the books of Kapil and Gourav.
Books of Gaurav
Journal Entries
Debit Credit
₹ ₹
2017
Feb 01 Kapil A/c Dr. 21,000
To Sales A/c 21,000
(Being goods sold to Kapil)
To Kapil A/c 21,000
(Being bill of exchange duly accepted and returned by Kapil)
Feb 25 Bills Sent for Collection A/c Dr. 21,000
(Being the bill sent for collection to bank)
Mar 04 Kapil A/c Dr. 21,100
To Bank A/c 100
(Being the bill dishonoured by Kapil and noting charges ₹ 100 are incurred and paid by bank)
Books of Kapil
Journal Entries
Debit Credit
₹ ₹
2017
To Gaurav A/c 21,000
(Being goods purchased from Gaurav)
Feb 01 Gaurav A/c Dr. 21,000
(Being the bill from Gaurav for the amount due accepted and returned)
To Gaurav A/c 21,000
(Being the bill dishonoured and the noting charges are incurred)
19. On Feb. 14, 2017 Rashmi sold good ₹ 7,500 to Alka. Alka paid ₹ 500 in cash and for the bank balance accepted a bill of exchange drawn upon
her by Rashmi payable after two months. On Apr.10, 2017 Alka approached Rashmi to cancel the bill since she was short of funds. She further
requested Rashmi to accept ₹ 2,000 in cash and draw a new bill for the balance including interest ₹ 500. Rashmi accepted Alka’s request and drew a
new bill for the amount due payable after 2 months. The bill was accepted by Alka. The new bill was duly met by Alka on maturity.
Record the necessary journal entries in the books of Rashmi and Alka and prepared Alka’s account in the books of Rashmi’s and Rashmi’s account in
the books of Alka’s
Books of Rashmi
Journal Entries
Debit Cred
Date Particulars L.F. Amount Amou
₹ ₹
2017
Feb 14 Alka A/c Dr. 7,500
To Sales A/c 7,5
(Being goods sold to Alka)
Feb 14 Cash A/c Dr. 500
Bills Receivable A/c Dr. 7000
To Alka A/c 7,5
(Being the liability partially settled by cash and bill of exchange drawn for the rest of the amount, duly accepted and
returned by Alka)
Apr 10 Alka A/c Dr. 7,000
x
(Being the bill cancelled as requested by Alka)
To Alka A/c 2,0
(Being the bill partially settled by Alka in cash)
Apr 10 Alka A/c Dr. 500
To Interest A/c 5
(Being interest charged to Alka due to cancellation of the bill)
Apr 10 Bills Receivable A/c Dr. 5,500
To Alka A/c 5,5
(Being bill drawn again for the rest of the liability)
Jun 13 Cash A/c Dr. 5,500
(Being the bill matured and duly met by paying in cash)
Alka’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Feb 14 To Sales A/c 7,500 Feb 14 By Cash A/c 500
Apr 10 To Bills Receivable A/c 7,000 Feb 14 By Bills Receivable A/c 7,000
Apr 10 To Interest A/c 500 Apr 10 By Cash A/c 2,000
Apr 10 By Bills Receivable A/c 5,500
15,000 15,000
Books of Alka
Journal Entries
Debit Credit
₹ ₹
2017
To Rashmi A/c 7,500
(Being goods purchased from Rashmi)
Feb 14 Rashmi A/c Dr. 500
To Cash A/c 500
(Being the liability is partially settled through paying ₹ 500 and bill is accepted and returned for the rest of the amount)
To Rashmi A/c 7,000
(Being the bill is cancelled upon request)
Apr 10 Rashmi A/c Dr. 2,000
To Cash A/c 2,000
(Being the liability is partially settled through payment of cash)
Apr 10 Interest A/c Dr. 500
To Rashmi A/c 500
(Being interest paid as the bill is cancelled)
Apr 10 Rashmi A/c Dr. 5,500
(Being the new bill accepted and returned)
Jun 13 Bills Payable A/c Dr. 5,500
To Cash A/c 5,500
(Being the new bill matured and settled through payment of cash)
Rashmi’s A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
Feb 14 To Cash A/c 500 Feb 14 By Purchases A/c 7,500
Feb 14 To Bills Payable A/c 7,000 Apr 10 By Bills Payable A/c 7,000
Apr 10 To Cash A/c 2,000 Apr 10 By Interest A/c 500
Apr 10 To Bills Payable A/c 5,500
15,000 15,000
x
20. Nikhil sold goods for ₹ 23,000 to Akhil on Dec. 01, 2017. He drew upon Akhil a bill of exchange for the same amount payable after 2 months.
Akhil accepted the bill and sent it back to Nikhil. Nikhil discounted the bill immediately with his bank @12 p.a. On the due date Akhil dishonoured
the bill of exchange and the bank paid Rs.100 as noting charges. Akhil requested Nikhil to draw a new bill upon him with interest @10% p.a. which
he agreed. The new bill was payable after two months. A week before the maturity of the second bill Akhil requested Nikhil to cancel the second
bill. He further requested to accept ₹ 10,000 in cash immediately and drew a third bill upon him including interest of ₹ 500. Nikhil agreed to Akhil’s
request. The third bill was payable after one month. Akhil met the third bill on its maturity. record the necessary journal entries in the books of
Nikhil and Akhil and also prepare Akhil’s account in the books of Nikhil and Nikhil’s account in the books of Akhil.
Books of Nikhil
Journal Entries
Debit Credit
₹ ₹
2017
Dec 01 Akhil A/c Dr. 23,000
To Sales A/c 23,0
(Being goods sold to Akhil) x
To Akhil A/c 23,0
(Being bill drawn and duly accepted and returned by Akhil)
(Being bill discounted with the bank @12% p.a. for 2 months)
2018
Feb 04 Akhil A/c Dr. 23,100
To Bank A/c 23,1
(Being the bill dishonoured on the maturity date by Akhil and the liability is restored)
Feb 04 Akhil A/c Dr. 385
To Interest A/c 3
(Being interest on the dishonoured bill)
To Akhil A/c 23,4
(Being a second bill drawn and duly accepted and returned by Akhil)
Mar 31 Akhil A/c Dr. 23,485
(Being the second bill cancelled as requested by Akhil)
To Akhil A/c 10,0
(Being cash received from Akhil towards partial settlement of the liability)
Mar 31 Akhil A/c Dr. 500
To Interest A/c 5
(Being interest charged to Akhil as greed by him)
To Akhil A/c 13,9
(Being third bill drawn and duly accepted and returned by Akhil)
(Being third bill matured and settled on the date of matured by paying cash)
Akhil A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
2018 2018
Feb 04 To Bank A/c 23,100 Feb 04 By Bills Receivable A/c 23,485
Feb 04 To Interest A/c 385 Mar 31 By Cash A/c 10,000
Mar 31 To Bills Receivables A/c 23,485 Mar 31 By Bills Receivable A/c 13,985
70,470 70,470
Books of Akhil
Journal Entries
Debit Credit
₹ ₹
2017
To Nikhil A/c 23,000
(Being goods purchased from Nikhil)
Dec 01 Nikhil A/c Dr. 23,000
(Being bill for the credit amount duly accepted and returned to Nikhil)
2018
Feb 04 Bill Payable A/c Dr. 23,000
(Being bill dishonoured and ₹ 100 noting charges incurred)
Feb 04 Interest A/c Dr. 385 x
To Nikhil A/c 385
(Being interest agreed to pay due to dishonouring of the bill)
Feb 04 Nikhil A/c Dr. 23,485
(Being second bill drawn by Nikhil and accepted and returned)
(Being second bill cancelled upon request, before maturity date is reached)
Mar 31 Nikhil A/c Dr. 10,000
To Cash A/c 10,000
(Being cash paid to Nikhil to partially settle the liability)
To Nikhil A/c 500
(Being interest agreed to pay as bill is cancelled upon request)
Mar 31 Nikhil A/c Dr. 13,985
(Being a third bill drawn and duly accepted and returned to Nikhil)
To Cash A/c 13,985
(Being the third bill matured and settled through cash payment)
Nikhil A/c
Dr. Cr.
Amount Amount
₹ ₹
2017 2017
2018 2018
Feb 04 To Bills Payable A/c 23,485 Feb 04 By Bills Payable A/c 23,000
Mar 31 To Cash A/c 23,000 Feb 04 By Noting Charges A/c 100
Mar 31 To Bills Payable A/c 13,985 Feb 04 By Interest A/c 385
Mar 31 By Bills Payable A/c 23,485
70,470 70,470
Working Notes:
100 12
= ₹ 22,540
Interest on dishonoured bill = ₹ 23, 100 × 10 × 2
100 12
(for 2 months on ₹ 23,100) = ₹ 385
21. On Jan 01, 2015 Vibha sold goods worth ₹ 18,000 to Sudha and drew upon the latter a bill of exchange for the same amount payable after two
months. Sudha accepted Vibha’s draft and returned the same to Vibha after acceptance. Vibha endorsed the bill immediately in favour of her
creditor Geeta. Five days before the maturity of the bill Sudha requested Vibha to cancel the bill since she was short of funds. She further requested
to draw a new bill upon her including interest of ₹ 200. Vibha accepted Sudha’s request. Vibha took the bill from Geeta by making the payment to
her in cash and cancelled the same. Then she drew a new bill upon Sudha as agreed. The new bill was payable after one month. The new bill was
duly met by Sudha on maturity. Record the necessary journal entries in the books of Vibha.
Books of Vibha
Journal Entries
Debit Credit
₹ ₹
2017
Jan 01 Sudha A/c Dr. 18,000
To Sales A/c 18,000
(Being goods sold to Sudha)
To Sudha A/c 18,000
(Being bill is drawn and the same is accepted and returned by Sudha)
Jan 01 Geeta A/c Dr. 18,000
(Being bill is endorsed in favour of Geeta)
Feb 27 Sudha A/c Dr. 18,000
x
To Geeta A/c 18,000
(Being bill is cancelled as requested by Sudha. The liability of the debtor and the creditor are restored.)
Feb 27 Sudha A/c Dr. 200
To Interest A/c 200
(Being interest charged to Sudha for cancellation of the bill)
Feb 27 Geeta A/c Dr. 18,000
To Cash A/c 18,000
(Being Geeta’s credit settled by payment through cash)
To Sudha A/c 18,200
(Being a second bill drawn and the draft is accepted and returned by Sudha)
(Being bill settled by Sudha on reaching maturity, by payment through cash)
22. Following was the position of debtor and creditor of Gautam as on 1.1.2017.
Debtors Creditors
₹ ₹
Babu 5,000 –
Chanderkala 8,000 –
Kiran 13,500 –
Anita 14,000 –
Anju – 5,000
Sheiba – 12,000
Manju – 6,000
The following transactions took place in the month of Jan 2017:

Jan 02
Drew on Babu at two months after date at full settlement for ₹ 4,800. Babu accepted the bill and returned it on 5.1.2017 .
Jan 04
Babu’s bill discounted for ₹ 4,750.
Jan 08
Chanderkala sent a promissory note for ₹ 8,000 payable three months after date.
Jan 10
Promissory note received from Chanderkala discounted for ₹ 7,900.
Jan 12
Accepted Sheiba draft for the amount due payable two months after date.
Jan 22
Anita sent his promissory note payable after two months.
Jan 23
Anita’s promissory note endorsed in favour of Manju.
Jan 25
Accepted Anju’s draft payable after three months.
Jan 29
Kiran sent ₹ 2,000 in cash and a promissory note for the balance payable after three months.
Record the above transactions in the proper subsidiary books.
Bills Receivable and Bills Payable books are recorded with only bills of exchanges as these are drawn by the firm owners. So, the promissory note transactions
will be recorded in the journal (not in the Bills Receivable and Bills Payable books)
Bills Receivable Book
From Cash
No. of Date Date of Where Ledger
Whom Drawer Acceptor Term Due date Amount Book Remarks
Bill Received Bill payable Folio
Received Folio
0001 Jan 02 Jan 05 Babu Self Babu 2 months Mar 05 4,800
Bills Payable Book

Cash
No. of Date of To Whom Where Ledger
Drawer Payee Term Due date Amount paid Date Book Remarks
Bill Bill Given payable Folio
Folio
001 Jan 12 Sheiba Sheiba 2 months Mar 15 12,000
002 Jan 25 Anju Anju 3 months Apr 28 5,000
Cash Book
Dr. Cr.
Cash Bank Cash Bank
₹ ₹ ₹ ₹
2017 2017
x
Jan 04 To Bills Receivable A/c 4,750 Jan 31 By Balance A/c 2,000 12,6
Jan 10 To Bills Receivable A/c 7,900
Jan 29 To Kiran A/c 2,000
2,000 12,650 2,000 12,6
Books of Gautam
Journal Entries
Debit Credit
₹ ₹
2017
Jan 02 Discount Allowed A/c Dr. 200
To Babu A/c 200
(Being discount allowed against acceptance and returning of the bill drawn)
Jan 02 Discount Charges A/c Dr. 200
To Babu A/c 200
(Being discount allowed against acceptance and returning of the bill drawn)
Jan 04 Discount Allowed A/c Dr. 50
(Being the bill discounted)
To Chandrakala A/c 8,000
(Being promissory note received from Chandrakala)
Jan 10 Discount Charges A/c Dr. 100
(Being promissory note received from Chandrakala is discounted with bank)
To Anita A/c 14,000
(Being promissory note received from Anita)
Jan 23 Manju A/c Dr. 14,000
(Being promissory note received from Anita is endorsed to Manju)
To Kiran A/c 11,500
(Being promissory note received from Kiran)
23. On Jan. 01, 2017 Harsh accepted a month’s bill for ₹ 10,000 drawn on him by Tanu for latter’s benefit. Tanu discounted the bill on same day
@ 8% p.a On the due date Tanu sent a cheque to Harsh for honour the bill. Harsh duly honoured his acceptance.
Record the journal entries in the Books of Tanu and Harsh
Books of Tanu
Journal Entries
Debit Credit
₹ ₹
2017
To Harsh A/c 10,000
(Being bill drawn against Harsh and duly accepted and returned by him, to accommodate self)
(Being the bill discounted from the bank)
Feb 04 Harsh A/c Dr. 10,000
To Bank A/c 10,000
(Being bills is settled by paything Harsh through cheque)
Books of Harsh
Journal Entries
Debit Credit
₹ ₹
2017
Jan 01 Tanu A/c Dr. 10,000
(Being bill of exchange duly accepted and returned to Tanu to accommodate him)
To Tanu A/c 10,000
(Being cheque received from Tanu to settle the bill)
To Bank A/c 10,000
(Being the bill settled with the bank by paything through cheque)
Working Notes:
Discount from Bank = 10, 000 × 8 × 112

10
= ₹ 67
= ₹ 9,933
24. Ritesh and Naina were in need of funds temporarily. On August 01 2017 Ritesh drew upon Naina a bill for ₹ 12,000 for 4 months. Naina
Accepted the bill and returned to Ritesh. Ritesh discounted the Bill @ 8% p.a. Half amount of the discounted bill remitted to Naina. On due date,
x
Ritesh sent the required sum to Naina, who met the bill. Journalise the transaction in the books of both the parties.
As it is a mutual understaning that the accommodated funds should be shared equally, the discount amount is also borne equally by both the parties.
Books of Ritesh
Journal Entries
Debit Credit
₹ ₹
2017
Aug 01 Bills Receivable A/c Dr. 12,000
To Naina A/c 12,000
(Being bill drawn against Naina and duly accepted and returned by him, to accommodate self)
Aug 01 Bank A/c Dr. 11,680
(Being bill discounted with the bank)
Aug 01 Naina A/c Dr. 6,000
To Bank A/c 5,840
To Discount Charges A/c 160
(Being half of the discounted amount remitted to Naina)
Dec 04 Naina A/c Dr. 6,000
To Bank A/c 6,000
(Being the rest of the amount transferred to Naina so that she can meet the bill)
Books of Naina
Journal Entries
Debit Credit
₹ ₹
2017
Aug 01 Ritesh A/c Dr. 12,000
(Being bill drawn by Ritesh duly accepted and returned by him, to accommodate him)
Aug 01 Bank A/c Dr. 5,840
To Ritesh A/c 6,000
(Being half of the discounted amount remitted by Ritesh)
To Ritesh A/c 6,000
(Being rest half of the bill amount remitted by Ritesh)
Dec 04 Bills Payable A/c Dr. 12,000
To Bank A/c 12,000
(Being the bill matured and the liability is discharged)
Working Notes:
100 12
= ₹ 11,680
Discount charges shared = ₹ 320 × 1
2
(with Naina) = ₹ 160
25. On Jan. 01, 2017, Bhanu and Naman drew on each other a bill for ₹ 8,000 payable 3 months after the due date for their Mutual benefit. On
January 02 they discounted with their bank each other’s bill at 5% p.a. on the due date each met his Own’s acceptance. Give journal entry in the
books of Bhanu and Naman.
Books of Bhanu
Journal Entries
Debit Credit
₹ ₹
2017
To Naman A/c 8,000
(Being bill drawn on Naman duly accepted and returned by him, to accommodate self)
Jan 01 Naman A/c Dr. 8,000
x
(Being bill drawn by Naman duly accepted and returned to him, to accommodate him)
(Being bill discounted with bank)
To Bank A/c 8,000
(Being bill is matured and duly met)
Books of Naman
Journal Entries
Debit Credit
₹ ₹
2017
To Naman A/c 8,000
(Being bill drawn on Bhanu duly accepted and returned by him, to accommodate self)
Jan 01 Naman A/c Dr. 8,000
(Being bill drawn by Bhanu duly accepted and returned to him, to accommodate him)
To Bank A/c 8,000
(Being bill is matured and duly met)
Working Notes:
100 12
= ₹ 7,900
26. On Nov. 01, 2017 Sonia drawn a bill on Sunny for ₹ 15,000 for 3 months for mutual accommodation. Sunny accepts the bill and return it to
sonia. Sonia discounted the same with his bankers @ 6% p.a. The proceeds are shared between Sonia and Sunny in proportion of ⅔rd, ⅓rd
respectively. On the due date sonia remits his proportion to Sunny who fails to met the bill and as a result sonia has to meet it. Sunny Give a fresh
acceptance for the amount due to sonia plus interest of ₹ 100 Sunny meet his second acceptance on due date. Record the necessary journal entries
in the books of sonia and sunny.
The duration of maturity in the second case is not provided in the problem. So, it is assumed that in the second instance also the bill is drawn for 3 months.
Books of Sonia
Journal Entries
Debit Credit
₹ ₹
2017
Nov 01 Bills Receivable A/c Dr. 15,000
To Sunny A/c 15,000
(Being bill drawn on Sunny duly accepted and returned by him, to accommodate both)
Nov 01 Bank A/c Dr. 14,775
Nov 01 Sunny A/c Dr. 5,000
To Cash A/c 4,925
To Discount Charges A/c 75
(Being sunny’s proceeds are transferred to him while retaining the discount)
2018
Feb 04 Sunny A/c Dr. 10,000
To Cash A/c 10,000
(Being rest of the bill amount transferred to Sunny to enable him meet the bill)
Feb 04 Sunny A/c Dr. 15,000
To Bank A/c 15,000
(Being the bill dishonoured by Sunny)
Feb 04 Sunny A/c Dr. 100
To Interest A/c 100
(Being interest charged to Sunny as he dishonoured the bill)
To Sunny A/c 15,100
(Being bill drawn on Sunny, duly accepted and returned by him)
(Being bill matured on the due date and met by Sunny)
Books of Sunny
Journal Entries
Debit Credit
₹ ₹
2017
Nov 01 Sonia A/c Dr. 15,000
x
(Being bill drawn by Sonia duly accepted and returned to her, to accommodate both)
Nov 01 Cash A/c Dr. 4,925
To Sonia A/c 5,0
(Being received the accommodation amount from Sonia)
2018
To Sonia A/c 10,0
(Being cash received from Sonia to settle the bill)
To Sonia A/c 15,0
(Being amount liable to Sonia due to dishonouring of the bill)
Feb 04 Interest A/c Dr. 100
To Sonia A/c 1
(Being interest payable to Sonia due to dishonouring of the bill)
Feb 04 Sonia A/c Dr. 15,100
(Being bills drawn by Sonia, duly accepted and returned to her)
May 07 Bills Receivable A/c Dr. 15,100
To Cash A/c 15,1
(Being the bill matured and settled by paying cash)
Working Notes:
100 12
= ₹ 14,775
Sonia’s Proceeds = ₹ 14, 775 × 2
3
= ₹ 9,850
Sunny’s Proceeds = ₹ 14, 775 × 1
3
= ₹ 4,925
Sunny’s Discount Share = ₹ 225 × 1
3
= ₹ 75
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Class 12 Mathematics
1. Relations and Functions
2. Inverse Trigonometric Functions
3. Matrices
4. Determinants
Class 12 Accountancy
1. Accounting for Not-for-Profit Organisation
2. Accounting for Partnership : Basic Concepts
3. Reconstitution of a Partnership Firm – Admission of a Partner
4. Reconstitution of a Partnership Firm – Retirement/Death of a Partner
5. Dissolution of Partnership Firm
6. Accounting for Share Capital
7. Issue and Redemption of Debentures
8. Financial Statements of a Company
9. Analysis of Financial Statements
10. Accounting Ratios
11. Cash Flow Statement
Class 11 Accountancy
1. Introduction to Accounting
2. Theory Base of Accounting
3. Recording of Transactions - I x
4. Recording of Transactions - II
5. Bank Reconciliation Statement
6. Trial Balance and Rectification of Errors
7. Depreciation, Provisions and Reserves
8. Bill of Exchange
9. Financial Statements - I
10. Financial Statements - II
11. Accounts from Incomplete Records
12. Application of Computers in Accounting
13. Computerized Accounting System
14. Structuring Database for Accounting
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Bill of Exchange – Numerical Questions Solutions

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Discount from Bank = ₹ 7, 000 × 12 × 2

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Bills Receivable A/c

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Bills Payable A/c

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Discount from Bank = ₹ 10, 000 × 6 × 3

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Cash Discount provided to Sunil = 6 2

Discount from Bank = ₹ 40, 000 × 6 × 2 ​ ​

Mohan Traders A/c

Books of Bansal Traders

Mohan Traders A/c

100 = 1,000 – 100

120 = 1,200 – 120

200 = 2,000 – 200

500 = 5,000 – 500

Discount from Bank = ₹ 1, 080 × 12 × 1 ​ ​

Mar 06 Narayanan A/c Dr.

Discount from Bank = ₹ 25, 000 × 6 × 30​

25,000 (Being Bill of Exchange endorsed in favour of Ganesan)

Discount with Bank = ₹ 5, 000 × 6 × 1 ​ ​

Rebate on the bill = ₹ 20, 000 × 12 × 1

Discount from Bank = ₹ 20, 000 × 6 × 3

Discount from Bank = ₹ 15, 000 × 12 × 3

Discount from Bank = ₹ 12, 000 × 9 × 2​ ​

Interest Paid = ₹ 12, 000 × 12 × 2 ​ ​

Discount from Bank = ₹ 23, 000 × 12 × 2 ​ ​

The following transactions took place in the month of Jan 2017:

Bills Payable Book

2,000 12,650 2,000 12,6

Discount from Bank = 10, 000 × 8 × 112

Discount from Bank = ₹ 12, 000 × 8 × 4 ​ ​

Discount from Bank = ₹ 8, 000 × 5 × 3 ​ ​

Discount from Bank = ₹ 15, 000 × 6 × 3 ​ ​

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2. Inverse Trigonometric Functions

2. Accounting for Partnership : Basic Concepts

3. Reconstitution of a Partnership Firm – Admission of a Partner

4. Reconstitution of a Partnership Firm – Retirement/Death of a Partner

5. Dissolution of Partnership Firm

6. Accounting for Share Capital

7. Issue and Redemption of Debentures

8. Financial Statements of a Company

9. Analysis of Financial Statements

10. Accounting Ratios

11. Cash Flow Statement

2. Theory Base of Accounting

Discount from Bank = ₹ 40, 000 × 6 × 2

Discount from Bank = ₹ 1, 080 × 12 × 1

Discount from Bank = ₹ 25, 000 × 6 × 30

Discount with Bank = ₹ 5, 000 × 6 × 1

Discount from Bank = ₹ 12, 000 × 9 × 2

Interest Paid = ₹ 12, 000 × 12 × 2

Discount from Bank = ₹ 23, 000 × 12 × 2

Discount from Bank = ₹ 12, 000 × 8 × 4

Discount from Bank = ₹ 8, 000 × 5 × 3

Discount from Bank = ₹ 15, 000 × 6 × 3