Question

Abdula sold goods to Tahir on Jan 17, 2017 for Rs 18,000. He drew a bill of exchange for the same amount on Tahir for 45 days. On the same date Tahir accepted the bill and returned it to Abdulla. On the due date Abdulla presented the bill to Tahir which was dishonoured. Abdulla paid Rs 40 as noting charges. Five days after the dishonour of his acceptance Tahir settled his debt by making a payment of Rs 18,700 including interest and noting charges. Record the necessary journal entries in the books of Abdulla and Tahir. Also prepare Tahir's account in the books of Abdulla and Abdulla's account in the books of Tahir.

Answer 1

Books of Abdula Journal
Date		Particulars			L.F.	Debit Amount Rs	Credit Amount Rs
2017
Jan.17	Tahir			Dr.		18,000
			To Sales A/c				18,000
	(Goods sold to Tahir)
Jan.17	Bills Receivable A/c			Dr.		18,000
		To Tahir					18,000
	(Tahir's acceptance received)
Mar.06	Tahir			Dr.		18,040
		To Bills Receivable A/c					18,000
		To Cash					40
	(Tahir's acceptance dishonoured and Rs 40 paid as noting charges)
Mar.06	Tahir			Dr.		660
		To Interest A/c					660
	(Interest charged from Tahir on account of bill dishonoured)
Mar.12	Cash A/c			Dr.		18,700
		To Tahir					18,700
	(Tahir cleared his account by paying cash)

Ledger Tahir’s Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2017				2017
Jan.17	Sales		18,000	Jan.17	Bills Receivable		18,000
Mar.06	Bills Receivable		18,000	Mar.11	Cash		18,700
Mar.06	Cash		40
Mar.06	Interest		660
			36,700				36,700

Books of Tahir Journal
Date		Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
2017
Jan.17	Purchases A/c		Dr.		18,000
		To Abdula				18,000
	(Goods bought from Abdula)
Jan.17	Abdula		Dr.		18,000
		To Bills Payable A/c				18,000
	(Bill drawn by Abdula accepted, payable after 15 days)
Mar.06	Bills Payable A/c		Dr.		18,000
	Noting Charges A/c		Dr.		40
		To Abdula				18,040
	(Abula’s bill dishonoured)
Mar.07	Interest A/c		Dr.		660
		To Abdula				660
	(Interest charged on account of bill dishonoured)
Mar.11	Abdula		Dr.		18,700
		To Cash A/c				18,700
	(Cash paid to Abdula)

Ledger Abdula’sAccount
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2017				2017
Jan.17	Bills Payable		18,000	Jan.17	Purchases		18,000
Mar.11	Cash		18,700	Mar.06	Bills Payable		18,000
				Mar.06	Noting Charges		40
				Mar.06	Interest		660
			36,700				36,700