A purchases goods worth ₹ 6,200 from B and gives him his acceptance for ₹ 6,000 in full satisfaction. B purchases goods worth ₹ 10,000 from C and endorses the bill to him, paying the balance by cheque. On maturity the bill is dishonoured, noting charges amounted to ₹ 100.
Give the Journal entries in the books of A, B and C.

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Solution

Books of A

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

Purchases A/c

Dr.

6,200

To B

6,200

(Goods purchased from B)

B

Dr.

6,200

To Bills Payable A/c

6,000

To Discount Received A/c

200

(Bill drawn by B accepted and discount allowed by him)

Bills Payable A/c

Dr.

6,000

Discount Received A/c

Dr.

200

Noting Charges A/c

Dr.

100

To B

6,300

(Bill payable dishonoured)

Books of B

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

A

Dr.

6,200

To Sales A/c

6,200

(Good sold to A)

Bills Receivable A/c

Dr.

6,000

Discount Allowed A/c

Dr.

200

To A

6,200

(B’s acceptance received and discount allowed)

Purchases A/c

Dr.

10,000

To C

10,000

(Goods bought from C)

C

Dr.

10,000

To Bills Receivable A/c

6,000

To Bank A/c

4,000

(Bills Receivable and Cheque given to C to settle due)

A

Dr.

6,300

To C

6,100

To Discount Allowed A/c

200

(Bill accepted by B was dishonoured and C paid Rs 100 as Noting Charges)

Books of C

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

B

Dr.

10,000

To Sales A/c

10,000

(Goods sold to B)

Bills Receivable A/c

Dr.

6,000

Bank A/c

Dr.

4,000

To B

10,000

(Bill Receivable and Cheque received from B)

B

Dr.

6,100

To Bills Receivable A/c

6,000

To Cash A/c

100

(Bills Receivable received from B dishonoured and Rs 100 paid for noting the bill)

Suggest Corrections

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Books of A
Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	Purchases A/c	Dr.		6,200
	To B				6,200
	(Goods purchased from B)

	B	Dr.		6,200
	To Bills Payable A/c				6,000
	To Discount Received A/c				200
	(Bill drawn by B accepted and discount allowed by him)

	Bills Payable A/c	Dr.		6,000
	Discount Received A/c	Dr.		200
	Noting Charges A/c	Dr.		100
	To B				6,300
	(Bill payable dishonoured)

Books of B
Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	A	Dr.		6,200
	To Sales A/c				6,200
	(Good sold to A)

	Bills Receivable A/c	Dr.		6,000
	Discount Allowed A/c	Dr.		200
	To A				6,200
	(B’s acceptance received and discount allowed)

	Purchases A/c	Dr.		10,000
	To C				10,000
	(Goods bought from C)

	C	Dr.		10,000
	To Bills Receivable A/c				6,000
	To Bank A/c				4,000
	(Bills Receivable and Cheque given to C to settle due)

	A	Dr.		6,300
	To C				6,100
	To Discount Allowed A/c				200
	(Bill accepted by B was dishonoured and C paid Rs 100 as Noting Charges)

Books of C
Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	B	Dr.		10,000
	To Sales A/c				10,000
	(Goods sold to B)

	Bills Receivable A/c	Dr.		6,000
	Bank A/c	Dr.		4,000
	To B				10,000
	(Bill Receivable and Cheque received from B)

	B	Dr.		6,100
	To Bills Receivable A/c				6,000
	To Cash A/c				100
	(Bills Receivable received from B dishonoured and Rs 100 paid for noting the bill)