Y purchased goods for ₹ 6,000 on 1st June, 2011 from X and on the same date accepted a bill payable after three months. 3 days later, X endorsed the bill to Z. On maturity, the bill was dishonoured for non-payment and Z had to pay ₹ 50 as noting charges. Two days after the dishonour of bill, Y paid ₹ 2,000 to X and requested him to draw a second bill for the balance plus ₹ 90 for the amount of interest, payable after two months. X accepted the proposal and draws the bill on Y, which was accepted by Y and was duly met on maturity.
Pass Journal entries for the above transactions in the books of X.

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Solution

Books of X

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2011

June 01

Y

Dr.

6,000

To Sales A/c

6,000

(Goods sold to Y)

June 01

Bills Receivable A/c (Bill no. 1)

Dr.

6,000

To Y

6,000

(Y’s acceptance received)

June 04

Z

Dr.

6,000

To Bills Receivable A/c (Bill no. 1)

6,000

(Bill endorsed in favour of Z)

Sept.04

Y

Dr.

6,050

To Z

6,050

(Endorsed bill get dishonoured and noting charges were paid)

Sept.06

Cash A/c

Dr.

2,000

Bills Receivable A/c (Bill no. 2) (4,050 + 90)

Dr.

4,140

To Y

6,050

To Interest A/c

90

(Cash of Rs 2,000 was received and for the remaining balance new

Bill issued including interest of Rs 90)

Nov.09

Cash A/c

Dr.

4,140

To Bills Receivable A/c (Bill no. 2)

4,140

(Bill met on the due date)

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Similar questions

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Three days after the dishonour of the bill Xavier made full payment to Zen. 15 days after the dishonour of the bill, Yudi paid Rs. 4,000 to Xavier and requested him to draw a second bill for the balance plus Rs. 180 for the amount of interest, payable after two months. Xavier accepted the proposal and drew the bill. Bill met on the due date. Record the above transactions in the books of Xavier.

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Record the necessary Journal entries in the books of both X and Y.

Q. On 21st Sept. 2017, Radhika sold goods for ₹ 2,00,000 to Parvati and drew upon later a bill for the same amount payable after 3 months. The bill was accepted by Parvati, Radhika discounted the bill from bank at a discount of 15% p.a. on 21st Oct., 2017. On maturity, the bill was dishonoured. Parvati agreed to pay ₹ 1,20,000 in cash including ₹ 3,000 interest and accepted a new bill for 3 months. The new bill was endorsed to Gayatri in full settlement of his account ₹ 85,000. It was duly met on maturity. Pass entries in the books of Radhika.

Q. On 15th June, 2017, X sold to Y goods to the value of ₹ 15,000 drawing upon the latter two bills, one for ₹ 10,000 payable 2 months after date and other for ₹ 5,000 payable 3 months after date, X discounted the first bill with his bankers at 6% p.a. and endorsed the second bill in favour of his creditor, Z. The first bill was met on maturity but the second was dishonoured. Z paid ₹ 50 as noting charges. On 1st October, Y cleared his account to X by paying ₹ 5,100 which included ₹ 50 a s interest.

Q. On 1st January, 2018, Mr. X sold goods to Mr. Y for ₹ 4,500 on credit and drew 3 bills on him first bill for ₹ 1,000 for 1 month, second bill for ₹ 1,500 for 2 months and third bill for ₹ 2,000 for 3 months. Mr. Y accepted and returned all the bills to Mr. X.
The first bill was retained by Mr. X till the date of maturity. Second bill was endorsed to his creditor Mr. Z on 3rd January, 2018 and third bill was sent to bank for collection on 4th January, 2017. On maturity all the bills were dishonoured and noting charges amount to ₹ 10, ₹ 15 and ₹ 20 respectively.
Give the Journal entries in the books of X, Y and Z.

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Books of X
Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
2011
June 01	Y	Dr.		6,000
	To Sales A/c				6,000
	(Goods sold to Y)

June 01	Bills Receivable A/c (Bill no. 1)	Dr.		6,000
	To Y				6,000
	(Y’s acceptance received)

June 04	Z	Dr.		6,000
	To Bills Receivable A/c (Bill no. 1)				6,000
	(Bill endorsed in favour of Z)

Sept.04	Y	Dr.		6,050
	To Z				6,050
	(Endorsed bill get dishonoured and noting charges were paid)

Sept.06	Cash A/c	Dr.		2,000
	Bills Receivable A/c (Bill no. 2) (4,050 + 90)	Dr.		4,140
	To Y				6,050
	To Interest A/c				90
	(Cash of Rs 2,000 was received and for the remaining balance new Bill issued including interest of Rs 90)

Nov.09	Cash A/c	Dr.		4,140
	To Bills Receivable A/c (Bill no. 2)				4,140
	(Bill met on the due date)