Question No 8 Chapter No 16 - T.S. Grewal 11 Class

Question No 8 Chapter No 16

8. A owed B 8,000. He gave a bill for the same on 1st August 2017 payable after 4 months at the Bank of India. Chandni Chowk, Delhi. Immediately after receiving the bill, B endorsed it to C in payment of his debt. On 1st September, C discounted the bill at 12% p.a. The bill is met on the due date. Pass the necessary Journal entries in the books of A, B and C.

The solution of Question No 8 Chapter No 16: –

Books of A
Date	Particulars		L.F.	Debit	Credit
2017
Aug.01	B A/c	Dr.		8,000
	Bills Payable A/c				8,000
	(Being bill accepted by B )
Dec.04	Bills Payable A/c	Dr.		8,000
	To Bank A/c				8,000
	(Being bill received with Discount )

Books of B
Date	Particulars		L.F.	Debit	Credit
2017
Aug 01	Bills Receivable A/c	Dr.		8,000
	To A A/c				8,000
	(Being Bill accepted )
Aug 01	C A/c	Dr.		8,000
	To Bills Receivable A/c				8,000
	(Being Cash paid against the bill )

Books of C
Date	Particulars		L.F.	Debit	Credit
2018
Aug.01	Bills Receivable A/c	Dr.		8,000
	To B A/c				8,000
	(Being Bill receivable received from A)
Sep 01	Bank A/c	Dr.		7,760
	Discount Charges A/c	Dr.		240
	To Bills Receivable A/c				8,000
	(Being Amount owed to B was settled by Bills Receivable)

Working Note:

Calculation of Discount charges	=	Bills receivable	X	Rate	X	Period of Maturity
				100		12

=	8,000 X	X	12	X	3
			100		12

= Rs 240

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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