Question

On Jan 01, 2012 Siya sold goods worth Rs 18,000 to Sadhna and drew upon the latter a bill of exchange for the same amount payable after two months. Sadhna accepted Siya’s draft and returned the same to Siya after acceptance. Siya endorsed the bill immediately in favour of her creditor Seeta. Five days before the maturity of the bill Sadhna requested Siya to cancel the bill since she was short of funds. She further requested to draw a new bill upon her including interest of Rs 200. Siya accepted Sadhna’s request. Siya took the bill from Seeta by making the payment to her in cash and cancelled the same. Then she drew a new bill upon Sadhna as agreed. The new bill was payable after one month. The new bill was duly met by Sadhna on maturity. Record the necessary journal entries in the books of Siya.

Answer 1

$\begin{array}{c}\text{Books of Siya}\\ \text{Journal}\end{array}$

$\begin{array}{ccccc}\text{Date}& \text{Particulars}& \text{L.F.}& \text{Debit}& \text{Credit}\\ & & & \text{Amount (Rs)}& \text{Amount (Rs)}\\ 2012& & & & \\ \text{Jan.1}& \text{Sadhna}\text{Dr.}& & 18,000& \\ & \text{To Sales A/c}& & & 18,000\\ & \underset{–}{\text{(Goods sold to Sadhna)}}& & & \\ \text{Jan.1}& \text{Bills Receivable A/c}\text{Dr.}& & 18,000& \\ & \text{To Sadhna}& & & 18,000\\ & \underset{–}{\text{(Bill from Sadhna received)}}& & & \\ \text{Jan.1}& \text{Seeta}\text{Dr.}& & 18,000& \\ & \text{To Sales A/c}& & & 18,000\\ & \underset{–}{\text{(Goods sold to Sadhna)}}& & & \\ \text{Feb.27}& \text{Sadhna}\text{Dr.}& & 18,000& \\ & \text{To Seeta}& & & 18,000\\ & \underset{–}{\text{(The bill endoresed to Seeta dishonoured)}}& & & \\ \text{Feb.27}& \text{Seeta}\text{Dr.}& & 18,000& \\ & \text{To Cash A/c}& & & 18,000\\ & \underset{–}{\text{(Payment made to Seeta)}}& & & \\ \text{Feb.27}& \text{Sadhna}\text{Dr}& & 200& \\ & \text{To Interest A/c}& & & 200\\ & \underset{–}{\text{(Interest shown due for renewal of bill)}}& & & \\ \text{Feb.27}& \text{Bills Receivable A/c}\text{Dr}& & 18,200& \\ & \text{To Sadhna}& & & 18,200\\ & \underset{–}{\text{(New bill received from Sadhna)}}& & & \\ \text{Mar.31}& \text{Cash A/c}\text{Dr}& & 18,200& \\ & \text{To Bills Receivable}& & & 18,200\\ & \text{(Cash received from Sadhna against her}& & & \\ & \text{acceptance)}& & & \end{array}$