Question No 23 Chapter No 13

Question No 23 Chapter No 13

Insolvency of the Acceptor

23. On 1st August,2017 Pradeep drew a bill on Raju for Rs 75,000 for 3 months. This was for the amount which Raju owed to Pradeep. On Aug. 4,2017 Pradeep discounted the same at 14% p.a. from Bank. On November 12,2017 Raju requested Pradeep for renewal of the bill. Pradeep agreed on the condition that Rs 35000 be paid and that for the remaining amount Raju should accept a new bill for 3 months and that for the remaining amount Raju should accept a new bill for 3 months. These arrangements were duly carried out. The new bill was dishonoured on due date as Raju became insolvent. Pradeep received 40 paise in a Rs from Raju’s estate.
Show the entries in the books of both the parties

The solution of Question No 23 Chapter No 13: –

In the books of Pradeep
Date  Particulars
Aug.1Bill Receivable A/cDr. 75,000 
 To Raju A/c   75,000
 (Being goods sold to B.)    
Aug.4Bank A/cDr. 64,500 
 Discount A/cDr. 10,500 
 To Bill Receivable A/c   75,000
 (Being Bill discounted from bank)    
Nov.1Bill Receivable A/cDr. 75,000 
 To Bank A/c   75,000
 (Being bill dishonoured )    
Nov.1Bill Receivable A/cDr. 35,000 
 To Bank A/c   35,000
 (Being cash received from Raju)    
Nov.1Bill Receivable A/cDr. 40,000 
 To Bank A/c   40,000
 (Being new bill drawn on him)    
Jan.07Cash A/cDr. 16,000 
 Bad debts A/cDr. 24,000 
 To B A/c   40,000
 (Being bill dishonoured and 50% received in cash)    
In the books of Raju
Date  Particulars
Aug.1Bill Payable A/cDr. 75,000 
 To Pradeep A/c   75,000
 (Being purchases goods from A)    
Nov.1Bill Payable A/cDr. 75,000 
 To Pradeep A/c   75,000
 (Being bill dishonoured)    
Nov.1Pradeep A/cDr. 75,000 
 To Cash A/c   75,000
 (Being cash paid to Pradeep)    
Nov.1Bill Payable A/cDr. 40,000 
 To Pradeep A/c   40,000
 (Being bill dishonoured)    
Jan.07A A/cDr. 5,350 
 To Bill Payable A/c   5,350
 (Being purchases goods from A.)    
Dec.07Bill Payable A/c (iii)Dr. 5,350 
 To Cash A/c   3,264
 To Deficiency A/c   4,896
 (Being bill dishonoured and paid 40% in cash )    

Bills Payable Book | Subsidiary Books | Examples

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

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