Question

Question

Answer 1

Books of Vishal Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2006
Jan. 05	Manju	Dr.		7,000
	To Sales A/c				7,000
	(Goods sold to Manju)
Jan. 05	Bills Receivable A/c	Dr.		7,000
	To Manju				7,000
	(Manju accepted the bill)
Jan. 05	Bank A/c	Dr.		6,860
	Discounting Charges A/c	Dr.		140
	To Bills Receivable A/c				7,000
	(Bill discounted with bank @ 12% p.a. for 2 months)

Books of Manju Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2006
Jan. 05	Purchases A/c	Dr.		7,000
	To Vishal				7,000
	(Goods purchased from Vishal)
Jan. 05	Vishal	Dr.		7,000
	To Bills Payable A/c				7,000
	(Bill drawn by Vishal, accepted)
Mar. 08	Bills Payable A/c	Dr.		7,000
	To Cash A/c				7,000
	(Bill honoured on maturity)

Working Note:

Calculation of Discounting Charges

$\mathrm{Discounting}\mathrm{Charges}=7,000\times \frac{12}{100}\times \frac{2}{12}=\mathrm{Rs}140$