Question

On January 15, 2011, Kartar sold goods for Rs. 30,000 to Bhagwan and drew upon him three bills of exchanges of Rs. 10,000 each payable after one month, two months and three months respectively. The first bill was retained by Kartar till its maturity. The second bill was endorsed by him in favour of his creditor Ratna and the third bill was discounted by him immediately at the rate of 6% per annum. All the bills were met by Bhagwan. Journalise the above transactions in the books of Kartar and Bhagwan. Also, prepare ledger accounts in the books of Kartar and Bhagwan.

Answer 1

In the Books of Kartar
Journal Entries
$\begin{array}{cccccc}\text{Date}& \text{Particulars}& & \text{L.F.}& \text{Amt. (Dr.)}& \text{Amt. (Cr.)}\\ \text{2011}& & & & & \\ \text{Jan 15}& \text{Bhagwan's A/c}& \text{Dr.}& & \text{30,000}& \\ & \text{To Sales A/c}& & & & \text{30,000}\\ & \text{(Goods sold to Bhagwan)}& & & & \\ & \underset{–}{}& & & & \\ \text{Jan 15}& \text{Bills Receivable Ist A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{Bills Receivable IInd A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{Bills Receivable IIIrd A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{To Bhagwan's A/c}& & & & \text{30,000}\\ & \text{(Three acceptance received each for 10,000)}& & & & \\ & \underset{–}{}& & & & \\ \text{Jan 15}& \text{Ratan's A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{To Bills Receivable IInd A/c}& & & & \text{10,000}\\ & \text{(Second bill endorsed in favour of Ratan)}& & & & \\ & \underset{–}{}& & & & \\ \text{Jan 15}& \text{Bank A/c}& \text{Dr.}& & \text{9,850}& \\ & \text{Discount A/c}& \text{Dr.}& & \text{150}& \\ & \text{To Bills Receivable IIIrd A/c}& & & & \text{10,000}\\ & \text{(Third bill discounted by the bank at the rate of}6\%\text{per annum}& & & & \\ & \underset{–}{}& & & & \\ \text{Feb 18}& \text{Cash A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{To Bills Receivable Ist A/c}& & & & \text{10,000}\\ & \text{(First bill met on due date)}& & & & \end{array}$

$\begin{array}{cccccccc}\text{Dr.}& & & & \text{Bhagwan's Account}& & & \text{Cr.}\end{array}$

$\begin{array}{cccccccc}\text{Date}& \text{Particulars}& \text{J.F.}& \text{Amt. (Rs.)}& \text{Date}& \text{Particulars}& \text{J.F.}& \text{Amt. (Rs.)}\\ 2011& & & & \text{2011}& & & \\ \text{Jan 15}& \text{Sales A/c}& & \text{30,000}& \text{Jan 15}& \text{Bills}& & \text{10,000}\\ & & & & & \text{Receivable Ist}& & \\ & & & & & \text{Bills}& & \text{10,000}\\ & & & & & \text{Receivable IInd}& & \\ & & & & & \text{Bills}& & \text{10,000}\\ & & & & & \text{Receivable IIIrd}& & \\ & & & \underset{–}{\overline{30,000}}& & & & \underset{–}{\overline{30,000}}\end{array}$

In the Books of Bhagwan
Journal Entries

$\begin{array}{cccccc}\text{Date}& \text{Particulars}& & \text{LF}& \text{Amt. (Dr)}& \text{Amt. (Cr)}\\ \text{2011}& & & & & \\ \text{Jan 15}& \text{Purchase A/c}& \text{Dr}& & \text{30,000}& \\ & \text{To Kartar}& & & & \text{30,000}\\ & \text{(Goods purchased)}& & & & \\ & \underset{–}{}& & & & \\ \text{Jan 15}& \text{Kartar}& \text{Dr.}& & \text{30,000}& \\ & \text{To Bills Payable Ist A/c}& & & & \text{10,000}\\ & \text{To Bills Payable IInd A/c}& & & & \text{10,000}\\ & \text{To Bills Payable IIIrd A/c}& & & & \text{10,000}\\ & \text{(Three acceptance received each for 10,000)}& & & & \\ & \underset{–}{}& & & & \\ \text{Feb 18}& \text{Bills Payable IInd A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{To Cash A/c}& & & & \text{10,000}\\ & \text{(First bill paid on maturity)}& & & & \\ & \underset{–}{}& & & & \\ \text{Mar 18}& \text{Bills Payable IInd A/c}& \text{Dr}& & \text{10,000}& \\ & \text{To Bank A/c}& & & & \text{10,000}\\ & \text{(Second bill met on maturity)}& & & & \\ & \underset{–}{}& & & & \\ \text{Apr 18}& \text{Bills Payable IIIrd A/c}& \text{Dr.}& & \text{10,000}& \\ & \text{To Bank A/c}& & & & \text{10,000}\\ & \text{(Third bill met on maturity)}& & & & \end{array}$

$\begin{array}{cccccccc}\text{Dr.}& & & & \text{Kartar's Account}& & & \text{Cr.}\end{array}$

$\begin{array}{ccccccccc}\text{Date}& \text{Particulars}& \text{J.F.}& \text{Amt. (Rs.)}& \text{Date}& \text{Particulars}& \text{J.F.}& \text{Amt. (Rs.)}& \\ 2011& & & & \text{2011}& & & & \\ \text{Jan 15}& \text{Bills Payable Ist}& & \text{10,000}& \text{Jan 15}& \text{Purchases A/c}& & \text{30,000}& \\ & \text{Bills Payable}& & \text{10,000}& & & & & \\ & \text{IInd}& & & & & & & \\ & \text{Bills Payable}& & \text{10,000}& & & & & \\ & \text{IIIrd}& & & & & & & \\ & & & \underset{–}{\overline{30,000}}& & & & \underset{–}{\overline{30,000}}& \end{array}$