Question

PRACTICAL PROBLEMS

On 1^st August, 2012 Omprakash drew a bill of Rs 10,000 for 60 days after date on Sharadchandra. On 15^th August, 2012 Omprakash purchased goods from Hariprasad for Rs 12,000. On the same date Omprakash endorsed Sharadchandra’s bill in favour of Hariprasad and paid the balance by cheque at 1% cash discount. On the same date Hariprasad discounted the bill with his bank for Rs 9,500.

On the due date Sharadchandra honoured his acceptance presented by Hariprasad.

You are required to pass journal entries in the books of Omprakash, Sharadchandra and Hariprasad.

Answer 1

Books of Omprakash
Journal Entry
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
2012
Aug.01	Bills Receivable A/c	Dr.		10,000
	To Sharadchandra				10,000
	(Bill drawn and accepted)
Aug.15	Purchases A/c	Dr.		12,000
	To Hariprasad				12,000
	(Goods purchased from Harichandra on credit)
Aug.15	Hariprasad	Dr.		12,000
	To Bank A/c				1,980
	To Discount Received A/c				20
	To Bills Receivable A/c				10,000
	(Bill endorsed to Hariprasad, and rest of the amount paid by cheque at cash discount of 1%)

Books of Sharadchandra
Journal Entry
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
2012
Aug.01	Omprakash	Dr.		10,000
	To Bills Payable A/c				10,000
	(Bill accepted)
Oct.03	Bills Payable A/c	Dr.		10,000
	To Cash/Bank A/c				10,000
	(Amount of bill paid on maturity)

Books of Hariprasad
Journal Entry
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
2012
Aug15	Omprakash	Dr.		12,000
	To Sales A/c				12,000
	(Goods sold to Omprakash)
Aug.15	Bank A/c	Dr.		1,980
	Discount A/c	Dr.		20
	Bills Receivable A/c	Dr.		10,000
	To Omprakash A/c				12,000
	(Endorsed bill accepted for Rs 10,000 and rest of the amount received in cash after allowing cash discount of 1%)
Oct.03	Cash/Bank A/c	Dr.		10,000
	To Bills Receivable A/c				10,000
	(Endorsed bill honoured on due date)