Question

On Jan 01, 2016 Neha sold goods for Rs 20,000 to Muskan and drew upon her a bill of exchange payable after two months. One month before the maturity of the bill Muskan approached Neha to accept the payment against the bill at a rebate @ 12% p.a. Neha agreed to the request of Muskan and Muskan retired the bill under the agreed rate of rebate. Journalise the above transaction in the books of Neha and Muskan.

Answer 1

Books of Neha Journal
Date		Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
2016
Jan.01	Muskan		Dr.		20,000
		To Sales A/c				20,000
	(Goods sold to Muskan)
Jan.01	Bills Receivable A/c		Dr.		20,000
		To Muskan				20,000
	(Muskan's acceptance received)
Feb.04	Cash A/c		Dr.		19,800
	Rebate on bill A/c		Dr.		200
		To Bills Receivable A/c				20,000
	(Muskan’s acceptance retired one month before maturity and allowed rebate at 12% p.a.)

Books of Muskan Journal
Date		Particulars						L.F.	Debit Amount Rs	Credit Amount Rs
2016
Jan.01	Purchases A/c					Dr.			20,000
				To Neha						20,000
	(Goods bought from Neha)
Jan.01	Neha					Dr.			20,000
				To Bills Payable A/c						20,000
	(Bill drawn by Neha payable after 2 months accepted)
Feb.04	Bills Payable A/c					Dr.			20,000
			To Cash A/c							19,800
			To Rebate on Bills A/c							200
	(Bill paid one month before maturity and received rebate at 12% p.a.)