Question No 38 Chapter No 16 - T.S. Grewal 11 Class

Question No 38  Chapter No 16

38. Give the Journal entries for the following:
a B's acceptance to us for 1,000 due this day, renewed at his request for 3 months with interest @ 6% p.a.
b Our bill to Chandra for 5,000 renewed for 2 months with interest @ 6% p.a.
c B's acceptance of 3,000 is discharged on his paying us cash 1,000 and accepting a fresh bill for the balance with interest 100.

The solution of Question No 38 Chapter No 16:-

a

Journal

Date	Particulars		L.F.	Debit	Credit
	B A/c	Dr.		1,000
	To Bills Receivable A/c				1,000
	(Being B′s acceptance was cancelled)
	B A/c	Dr.		15
	To Interest A/c				15
	(Being Interest due from B)
	Bills Receivable A/c	Dr.		1,015
	To B A/c				1,015
	(Being Interest due from B)

 

Books of A

Date	Particulars		L.F.	Debit	Credit
	B A/c	Dr.		400
	To Bills Payable A/c				400
	(Being Bill drawn by A was accepted)
	Bills Payable A/c	Dr.		400
	To B				400
	(Being Bill drawn by B was dishonoured on maturity)

 

Case b The bills met at maturity

Books of B

Date	Particulars		L.F.	Debit	Credit
	Bills Receivable A/c	Dr.		400
	To Sales A/c				400
	(Being A′s acceptance was received)
	Bank A/c	Dr.		380
	Discount Charges A/c	Dr.		20
	To Bills Receivable A/c				400
	(Being A′s acceptance was discounted with the bank)

 

Working Note:

 

Interest	=	1,000	X	6	X	3
				100		12

Interest = Rs 15

b

Journal

Date	Particulars		L.F.	Debit	Credit
	Bills Payable A/c	Dr.		5,000
	To C. Chandra				5,000
	(Being Bill Payable was cancelled)
	Interest A/c	Dr.		50
	To C. Chandra				50
	(Being Interest at 6%)
	C. Chandra A/c	Dr.		5,050
	To Bills Payable A/c				5,050
	(Being new bill drawn by C. Chandra was accepted)

 

Working Note:

Interest	=	5,000	X	6	X	2
				100		12

Interest = Rs 50

c

Journal

Date	Particulars		L.F.	Debit	Credit
	B A/c	Dr.		3,000
	To Bills Receivable A/c				3,000
	(Being B got cancelled his acceptance)
	Cash A/c	Dr.		1,000
	To B				1,000
	(Being Cash received from B)
	B A/c	Dr.		100
	To Interest A/c				100
	(Being Interest due to A)
	Bills Receivable A/c	Dr.		2,100
	To B A/c				2,100
	(Being New bill accepted by B for balance amount including interest)

 

 

https://tutorstips.com/bill-of-exchange/

 

Thanks, Please Like and share with your friends  

Comment if you have any question.

Also, Check out the solved question of previous Chapters: -

• • Chapter No. 1 – Introduction to Accounting
  • Chapter No. 2 – Basic Accounting Terms
  • Chapter No. 3 – Theory Base of Accounting, Accounting Standards and International Financial Reporting Standards(IFRS)
  • Chapter No. 4 – Bases of Accounting
  • Chapter No. 5 – Accounting Equation
  • Chapter No. 6 – Accounting Procedures – Rules of Debit and Credit
  • Goods and Services Tax(GST)
  • Chapter No. 7 – Origin of Transactions – Source Documents and Preparation of Vouchers
  • Chapter No. 8 – Journal
  • Chapter No. 9 – Ledger
  • Chapter No. 10 – Special Purpose Books I – Cash Book
  • Chapter No. 11 – Special Purpose Books II – Other Books
  • Chapter No. 12 – Bank Reconciliation Statement
  • Chapter No. 13 – Trial Balance
  • Chapter No. 14 – Depreciation
  • Chapter No. 15 – Provisions and Reserves
  • Chapter No. 16 – Accounting for Bills of Exchange
  • Chapter No. 17 – Rectification of Errors
  • Chapter No. 18 – Financial Statements of Sole Proprietorship
  • Chapter No. 19 – Adjustments in preparation of Financial Statements
  • Chapter No. 20 – Accounts from incomplete Records – Single Entry System
  • Chapter No. 21 – Computers in Accounting
  • Chapter No. 22 – Accounting Software – Tally
  • Chapter No. 5 - Accounting Equation
  • Chapter No. 6 - Accounting Procedures - Rules of Debit and Credit
  • Goods and Services Tax(GST)
  • Chapter No. 8 - Journal
  • Chapter No. 9 - Ledger
  • Chapter No. 10 – Special Purpose Books I – Cash Book

Check out T.S. Grewal +1 Book 2019 @ Official Website of Sultan Chand Publication