Question

On 1st January, 2016, Shieba sold goods to Vishal for Rs. 10,000 and drew upon him bills of exchange of 2 months. Vishal accepted the bill and returned it to Shieba. On the date of maturity the bills was dishonoured by Vishal. Record the necessary entries in all the cases listed below in the books of Shieba and Vishal.

(i) When the bill is kept by Shieba till its maturity.

(ii) When the bill is discounted by Shieba for Rs. 200.

Noting charges were Rs. 100.

Answer 1

In the Books of Shieba
JOURNAL
$\begin{array}{ccccc}\text{Date}& \text{Particulars}& L.F.& \text{Amt. (Dr.)}& \text{Amt. (Cr.)}\\ & \underset{–}{\text{Entry in All the Cases}}& & & \\ 2016& & & & \\ \text{Jan 1}& \text{Vishal's A/c}\text{Dr.}& & 10,000& \\ & \text{To Sales A/c}& & & 10,000\\ & \underset{–}{\text{(Goods sold to Vishal)}}& & & \\ \text{Jan 1}& \text{Bills Receivable A/c}\text{Dr.}& & 10,000& \\ & \text{To Vishal's A/c}& & & 10,000\\ & \underset{–}{\text{(Vishal's acceptance received)}}& & & \\ & \text{Additional Entry in Case (i)}& & & \\ \text{Mar 4}& \text{Vishal's A/c}\text{Dr.}& & 10,100& \\ & \text{To Bills Receivable A/c}& & & 10,000\\ & \text{To Cash A/c}& & & 100\\ & \underset{–}{\text{(Vishal dishonoured his acceptance)}}& & & \\ & \text{Additional Entry in Case (ii)}& & & \\ \text{Jan 1}& \text{Bank A/c}\text{Dr.}& & 9,800& \\ & \text{Discount A/c}\text{Dr.}& & 200& \\ & \text{To Bills Receivable A/c}& & & 10,000\\ & \underset{–}{\text{(Bill receivable discounted with bank)}}& & & \\ \text{Mar 4}& \text{Vishal}\text{Dr.}& & 10,100& \\ & \text{To Bank A/c}& & & 10,100\\ & \text{(Discounted bill dishonoured by Vishal)}& & & \end{array}$

In the Books of Vishal
JOURNAL
$\begin{array}{ccccc}\text{Date}& \text{Particulars}& L.F.& \text{Amt. (Dr.)}& \text{Amt. (Cr.)}\\ 2016& & & & \\ \text{Jan 1}& \text{Purchanses A/c}\text{Dr.}& & 10,000& \\ & \text{To Shieba's A/c}& & & 10,000\\ & \underset{–}{\text{(Purchased goods from Shieba)}}& & & \\ \text{Jan 1}& \text{Shieba's A/c}\text{Dr.}& & 10,000& \\ & \text{To Bills Payable A/c}& & & 10,000\\ & \underset{–}{\text{(Accepted Shieba's draft)}}& & & \\ \text{Mar 4}& \text{Bills Payable A/c}\text{Dr.}& & 10,000& \\ & \text{Noting charges A/c}\text{Dr.}& & 100& \\ & \text{To Shieba's A/c}& & & 10,100\\ & \text{(Acceptance in favour of Shieba dishonoured)}& & & \end{array}$