Question

On 1st January, 2014, A drew a bill on B for Rs. 10,000 payable after 3 months. B accepted the bill and returned it to A. After 10 days, A endorsed the bill to his creditor, C. On the due date, the bill was dishonoured and C paid Rs.200 as noting charges. Record the transactions in the books of A, B and C.

Answer 1

A's Journal
$\begin{array}{cccc}2011& & & \\ \text{Jan 1}& \text{Bills Receivable A/c}\text{Dr.}& 10,000& \\ & \text{To B}& & 10,000\\ & \text{(Being acceptance received)}& & \\ \text{Jan.11}& \text{C Dr.}& 10,000& \\ & \text{To Bills Receivable A/c}& & 10,000\\ \text{April 4}& \text{B Dr.}& 10,200& \\ & \text{To C}& & 10,200\\ & \text{(Being bill dishonoured and noting charges paid by C)}& & \end{array}$

B's Journal
$\begin{array}{cccc}2011& & & \\ \text{Jan.1}& \text{A}\text{Dr}& 10,000& \\ & \text{To Bills acceptance given}& & 10,000\\ \text{April 4}& \text{Bills Payable A/c}\text{Dr.}& 10,000& \\ & \text{Noting charges A/}\text{Dr.}& 200& \\ & \text{To A}& & 10,000\\ & \text{(Being bill dishonoured and noting charges paid)}& & \end{array}$

C's Journal
$\begin{array}{cccc}2011& & & \\ \text{Jan.11}& \text{Bills Receivable}\text{Dr.}& 10,000& \\ & \text{To A}& & 10,000\\ & \text{(Being bill received from A)}& & \\ \text{April.4}& \text{A}\text{Dr.}& 10,200& \\ & \text{To Bills Receivable}& & 10,000\\ & \text{To Cash A/c}& & 200\\ & \text{(Being bill dishonoured and noting charges paid)}& & \end{array}$