Question

On Jan. 1, 2017 Neha sold goods for ₹ 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 transactions in the books of Neha and Muskan.

Answer 1

Books of Neha Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2017
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 accepted the bill)
Feb. 04	Cash A/c	Dr.		19,800
	Rebate A/c	Dr.		200
	To Bills Receivable A/c				20,000
	(Bill retired under the rebate @ 12% p.a. for 1 month)

Books of Muskan Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2017
Jan. 01	Purchases A/c	Dr.		20,000
	To Neha				20,000
	(Goods purchased from Neha)
Jan. 01	Neha	Dr.		20,000
	To Bills Payable A/c				20,000
	(Bill drawn by Neha, accepted)
Feb. 04	Bills Payable A/c	Dr.		20,000
	To Cash A/c				19,800
	To Rebate A/c				200
	(Bill retired under the rebate of 12% p.a. before one month)

Working Note:

Calculation of amount of Rebate

$\mathrm{Amount}\mathrm{of}\mathrm{Rebate}=20,000\times \frac{12}{100}\times \frac{1}{12}=\mathrm{Rs}200$