Page 158 - ISCDEBK-XI

Bill of Exchange 17.23
Solution: In the Books of A
JOURNAL
Date Particulars L.F. Dr. (`) Cr. (`)
2021
Jan. 1 B ...Dr. 30,000
To Sales A/c 30,000
(Being the sale of goods to B)
Jan. 1 Bills Receivable A/c ...Dr. 30,000
To B 30,000
(Being the acceptance received)
Jan. 4 Bank A/c ...Dr. 29,250
Discounting Charges A/c ...Dr. 750
To Bills Receivables A/c 30,000
(Being the bill discounted with bank @ 10% p.a.)
April 4 B ...Dr. 30,100
To Bank A/c 30,100
(Being the bill dishonoured at maturity, noting charges ` 100)
April 4 Bank A/c ...Dr. 10,000
To B 10,000
(Being the part payment received from B)
April 4 B ...Dr. 242
To Interest A/c (WN 1) 242
(Being the interest charged for renewing the bill)
April 4 Bills Receivable A/c ...Dr. 12,000
To B 12,000
(Being the fresh bill drawn on B for 1 month and accepted by him)
April 4 Bills Receivable A/c (WN 2) ...Dr. 8,342
To B 8,342
(Being the another bill drawn on B for the balance along with
interest for both the bills)
May 7 Bank A/c ...Dr. 12,000
To Bills Receivable A/c 12,000
(Being the first bill honoured at maturity)
May 7 B ...Dr. 8,342
To Bills Receivable A/c 8,342
(Being the second bill dishonoured at maturity)
July 4 Bank A/c ...Dr. 4,171
Bad Debts A/c ...Dr. 4,171
To B 8,342
(Being 50% of the amount due from B received in full settlement)
Working Notes: `
1. Interest on ` 12,000 @ 8% p.a. for 1 month (` 12,000 × 8/100 × 1/12) 80
Add: Interest on ` 8,100 @ 8% p.a. for 3 months (` 8,100 × 8/100 × 3/12) 162
Total 242
2. ` 30,000 – (` 10,000 + ` 12,000) + ` 100 (Noting Charges) + ` 242 (Interest) = ` 8,342.