Question No 13 Chapter No 13

Question No 13 Chapter No 13

Dishonour and Renewal of Bill

13. A sells goods for 30,000 to B on 1st January, 2018 and on the same day draws a bill on B at three months for the amount. B accepts it and returns it to A, who discounts it on 4th February, 2017 with his bank at 18% per annum. The acceptance is dishonoured on the due date, the noting charges paid by the bank being 200.
On 4th April, 2017, B accepts a new bill at two months for the amount then due to A together with interest at 12 per cent per annum.
Make Journal entries to record these transactions in the books of A and B.

The solution of Question No 13 Chapter No 13: –

In the books of A (Drawer)
Date  Particulars
L.F.DebitCredit
2016     
Jan.01B A/cDr. 30,000 
 To Sale A/c   30,000
 (Being Goods sold to B )    
      
Jan.01Bills Receivable A/cDr. 30,000 
 To Dinesh A/c   30,000
 (Being B accepted the bill)    
      
Mar.04Bank A/cDr. 29,100 
 Discounting Charges A/cDr. 900 
 To Bills Receivable A/c   30,000
 (Being Bill discounted with the bank @18%)    
      
Apr. 04B A/cDr. 30,200 
 To Bank A/c   30,200
 (Being Bill dishonoured on due date and noting charges paid)    
      
Apr. 04B A/cDr. 604 
 To Interest A/c   604
 (Being Cash received from Dinesh)    
      
Apr. 04Bills Receivable A/cDr. 30,804 
 To B A/c   30,804
 (Being Dinesh accepted the new bill)    
      
Jul.07Cash A/cDr. 30,804 
 To Bills Receivable A/c   30,804
 (Being Bill honoured on due date)    
     
In the books of B (Drawee)
Date  Particulars
L.F.DebitCredit
2016     
Jan. 01Purchases A/cDr. 30,000 
 To A A/c   30,000
 (Being Goods purchased from A)    
      
Jan. 01A A/cDr. 30,000 
 To Bills Payable A/c   30,000
 (Being Bill drawn by X, accepted)    
      
Apr. 04Bills Payable A/cDr. 30,000 
 Noting Charges A/cDr. 200 
 To A A/c   30,200
 (Being Bill dishonoured on due date and noting charges paid)    
      
Apr. 04Interest A/cDr. 604 
 To A A/c   604
 (Being Interest due to be paid)    
      
Mar. 04Interest A/cDr. 2,400 
 To Chander   2,400
 (Being interest due to being paid)    
      
Apr. 04A A/cDr. 30,804 
 To Bills Payable A/c   30,804
 (Being New bill drawn by A, accepted)    
      
Jul. 04Bills Payable A/cDr. 30,804 
 To Cash A/c   30,804
 (Being interest due to be paid)    
     

Working Note: –

Calculation of Discounting Charges

Discounting Charges=30,00018X2
10012
       
 =Rs 900    

Calculation of amount of Interest

Amount of Interest=30,00012X2
10012
       
 =Rs 604    

Bills Payable Book | Subsidiary Books | Examples

Also, Check out the solved question of all Chapters: –

D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution

Check out the Accountancy Class +1 by D.K. Goal (Arya Publication) from their official Site.

ISC Accounts 11 20 Image min 197x300 - Question No 13 Chapter No 13 - D.K Goal 11 Class
D K Goel accountancy +1 – ISC_Accounts_11_20_ImageQuestion No 42 Chapter No 11 – D.K Goal 11 Class

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