Question

On 17th April, 2016, X sold goods to Y for ₹ 80,000 and draws a bill for 2 months upon Y for the amount due. Y accepted the bill and returned it to X. On due date the bill became dishonoured and X paid ₹ 400 as Noting Charges. Fifteen days later Y pays the amount due to X. Pass Journal entries in the books of both the parties.

Answer 1

Books of X Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2016
Apr. 17	Y	Dr.		80,000
	To Sales A/c				80,000
	(Goods sold to Y)
Apr. 17	Bills Receivable A/c	Dr.		80,000
	To Y				80,000
	(Y accepted the bill)
June 20	Y	Dr.		80,400
	To Bills Receivable A/c				80,000
	To Cash A/c				400
	(Bill dishonoured on due date and noting charges received)
July 05	Cash A/c	Dr.		80,400
	To Y				80,400
	(Cash received from Y)

Books of Y Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2016
Apr. 17	Purchases A/c	Dr.		80,000
	To X				80,000
	(Goods purchased from X)
Apr. 17	X	Dr.		80,000
	To Bills Payable A/c				80,000
	(Bill drawn by X, accepted)
June 20	Bills Payable A/c	Dr.		80,000
	Noting Charges A/c	Dr.		400
	To X				80,400
	(Bills dishonoured on due date and notice charged paid)
July 05	X	Dr.		80,400
	To Cash A/c				80,400
	(Cash paid to X)