Question

Kapil purchased goods for Rs. 21,000 from Gaurav on 1st February, 2016 and accepted the bills of exchange drawn by Gaurav for the same amount. The bill was payable after a month. On 25th February, 2016, Gaurav sent the bill to his bank for collection. The bill was duly presented by the bank. Kapil dishonoured the bill and the bank paid Rs. 100 as noting charges.

Record the necessary journal entries for the above transactions in the books of Kapil and Gaurav.

Answer 1

In the Books of Gaurav
JOURNAL
$\begin{array}{ccccc}\text{Date}& \text{Particulars}& L.F.& \text{Amt (Dr.)}& \text{Amt (Cr.)}\\ 2016& & & & \\ \text{Feb 1}& \text{Kapil's A/c}\text{Dr.}& & 21,000& \\ & \text{To Sales A/c}& & & 21,000\\ & \underset{–}{\text{(Goods sold to Kapil)}}& & & \\ \text{Feb 1}& \text{Bills Receivable A/c}\text{Dr.}& & 21,000& \\ & \text{To Kapil's A/c}& & & 21,000\\ & \underset{–}{\text{(Acceptance received from Kapil)}}& & & \\ \text{Feb 25}& \text{Bill Sent for Collection A/c}\text{Dr.}& & 21,000& \\ & \text{To Bills Receivable A/c}& & & 21,000\\ & \underset{–}{\text{(Bills sent to the bank for collection)}}& & & \\ \text{Mar 4}& \text{Kapil's A/c}\text{Dr.}& & 21,100& \\ & \text{To Bill Sent for Collection A/c}& & & 21,000\\ & \text{To Bank A/c}& & & 100\\ & \text{(Bill dishonourd on due date and noting charges paid)}& & & \end{array}$

In the Books of Kapil
JOURNAL
$\begin{array}{ccccc}\text{Date}& \text{Particulars}& L.F.& \text{Amt (Dr.)}& \text{Amt (Cr.)}\\ 2016& & & & \\ \text{Feb 1}& \text{Purchases A/c}\text{Dr.}& & 21,000& \\ & \text{To Gaurav's A/c}& & & 21,000\\ & \underset{–}{\text{(Goods purchased from Gaurav on credit)}}& & & \\ \text{Feb 1}& \text{Gaurav's A/c}\text{Dr.}& & 21,000& \\ & \text{To Bills Payable A/c}& & & 21,000\\ & \underset{–}{\text{(Acceptance given)}}& & & \\ \text{Mar 4}& \text{Bills Payable A/c}\text{Dr.}& & 21,000& \\ & \text{Noting Charges A/c}\text{Dr.}& & 100& \\ & \text{To Gaurav's A/c}& & & 21,100\\ & \text{(Bill dishonoured and noting charges due)}& & & \end{array}$