Question No 38 Chapter No 15

Question No 38 Chapter No 15

Renewal of Bill

38. B sends his promissory note for 3 months to C for Rs 6,000 on May 1,2018. C gets it discounted with his bankers @6 percent per annum. On the due date, the bill is dishonoured, the bank paying Rs 100 as noting charges. C agreed to accept Rs 2,250 in cash (Rs 250 for nothing charges and interest) and another promissory note for Rs 4,000 for 2 months. On the due date, B approaches C again and asks for renewal of the bill for a further period of 3 months. C egress to the request provided B pays Rs 200 as interest in cash. The last bill is paid o Maturity
Draft journal entries in the book of B and C.

The solution of Question No 38 Chapter No 15: –

 

In the book of B (Drawee)
Date  Particulars
L.F.DebitCredit
2018     
May.1C A/cDr. 6,000 
 To Bill payable A/c   6,000
 (Being goods purchased on credit .)    
      
Aug.4Bill payable A/cDr. 6,000 
 Nothing charges A/cDr. 100 
 To Y A/c   6,100
 (Being cancellation of the old bill.)    
      
Aug.4C A/cDr. 2,100 
 Interest A/cDr. 150 
 To Bill Payable A/c   2,250
 (Being payment of interest and part payment of the amount due to C.)    
      
Aug.4C A/cDr. 4,000 
 To Bill Payable A/c   4,000
 (Being a new bill accepted in favour of Bimal including interest.)    
      
Oct.7Bill Payable A/cDr. 4,000 
 To C A/c   4,000
 (Being payment of the bill on maturity.)    
      
Oct.7Interest A/cDr. 200 
 To Cash A/c   200
 (Being interest paid in cash .)    
      
Oct.7C A/cDr. 4,000 
 To Bill Payable A/c   4,000
 (Being acceptance of a fresh bill at 3 months.)    
2019     
Jan.10Bill Payable A/cDr. 4,000 
 To Cash A/c   4,000
 (Being payment of the bill on the due date .)    
     

 

In the book of C (Drawer)
Date  Particulars
L.F.DebitCredit
2018     
May.1Bill Receivable A/cDr. 6,000 
 To B A/c   6,000
 (Being receipt of an acceptance.)    
      
May.1Bank A/cDr. 5,910 
 Discount A/cDr. 90 
 To Bill Receivable A/c   6,000
 (Being receipt of an acceptance for one month.)    
      
Aug.4B A/cDr. 6,100 
 To Bank A/c   6,100
 (Being cancellation of the bill.)    
      
Aug.4Cash A/cDr. 2,250 
 To B A/c   2,100
 To Interest A/c   150
 (Being receipt of interest and part payment of 1 amount due to B.)    
      
Aug.4Bill Receivable A/cDr. 4,000 
 To B A/c   4,000
 (Being receipt of an acceptance for the balance amount.)    
      
Oct.7B A/cDr. 4,000 
 To Bill Receivable A/c   4,000
 (Being cancellation of Bill.)    
      
Oct.7Cash A/cDr. 200 
 To Interest A/c   200
 (Being the receipt of interest.)    
      
Oct.7Bill Receivable A/cDr. 4,000 
 To B A/c   4,000
 (Being the receipt for a fresh acceptance at three months.)    
2019     
Jan.10Cash A/cDr. 4,000 
 To Bill Receivable A/c   4,000
 (Being the payment of bill received on maturity.)    
     

 

Bills Receivable Book | Subsidiary Books | Examples

 

Bills Payable Book | Subsidiary Books | Examples

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

Usha Publication – Elements of Book-Keeping PSEB (Class 11) – Solution

Chapter No. 1 – Introduction

Chapter No. 2 – Theory Base of Accounting 

Chapter No. 3 – Origin of Transactions

Chapter No. 4 – Vouchers and transactions

Chapter No. 5 – Journal

Chapter No. 6 – Accounting for Goods and Services Tax(GST)

Chapter No. 7 – Ledger

Chapter No. 8 – Cash Book

Chapter No. 9 – Other Subsidiary Books

Chapter No. 10 – Journal Proper

Chapter No. 11 – Trial Balance

Chapter No. 12 – Bank Reconciliation Statement

Chapter No. 13 – Depreciation

Chapter No. 14 – Provisions and Reserves 

Chapter No. 15 – Bills of Exchange

Chapter No. 16 – Rectification of Errors 

Chapter No. 17 – Financial Statements – (Without Adjustments)

Chapter No. 18 – Financial Statements – (With Adjustments)

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