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X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is discounted with banker at a charge of Rs 100. At maturity the bill return dishonoured. In the books of X, for dishonour, the bank account will be credited by:
  • a)
    19,900
  • b)
    20,000
  • c)
    20,100
  • d)
    19,800
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is ...
Solution:

Bill Transactions
X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is discounted with banker at a charge of Rs 100.

- The total amount of the bill is Rs 20,000.
- The bill is discounted with a banker, which means X receives money from the bank before the maturity of the bill.
- The banker charges Rs 100 for the discounting transaction.

Dishonour of Bill
At maturity, the bill returns dishonoured.

- This means that Y did not pay the amount of the bill on the maturity date.
- X is now liable to pay the amount of the bill to the bank.

Journal Entry for Dishonour
In the books of X, for dishonour, the bank account will be credited by Rs 20,000.

- This means that X will reduce the bank account balance by Rs 20,000.
- The reason for the credit entry is that the bank has paid the amount of the bill to X.
- X is liable to pay the bank back the amount of the bill as it was dishonoured by Y.
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X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is discounted with banker at a charge of Rs 100. At maturity the bill return dishonoured. In the books of X, for dishonour, the bank account will be credited by:a)19,900b)20,000c)20,100d)19,800Correct answer is option 'B'. Can you explain this answer?
Question Description
X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is discounted with banker at a charge of Rs 100. At maturity the bill return dishonoured. In the books of X, for dishonour, the bank account will be credited by:a)19,900b)20,000c)20,100d)19,800Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is discounted with banker at a charge of Rs 100. At maturity the bill return dishonoured. In the books of X, for dishonour, the bank account will be credited by:a)19,900b)20,000c)20,100d)19,800Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X draws a bill on Y for Rs 20,000 for 3 months on 1.1.05. The bill is discounted with banker at a charge of Rs 100. At maturity the bill return dishonoured. In the books of X, for dishonour, the bank account will be credited by:a)19,900b)20,000c)20,100d)19,800Correct answer is option 'B'. Can you explain this answer?.
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