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A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804
? Related: Dishonour of Bill
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A sells goods for Rs30,000 to B on 1st january ,2017 and on the same d...
**Journal Entries in the Books of A and B**
1. **On 1st January 2017**
A's Books:
- Accounts Receivable (B) | 30,000
- Sales | 30,000
B's Books:
- Purchases | 30,000
- Accounts Payable (A) | 30,000
2. **On 1st January 2017**
A's Books:
- Bills Receivable (B) | 30,000
- Accounts Receivable (B) | 30,000
B's Books:
- Bills Payable (A) | 30,000
- Accounts Payable (A) | 30,000
3. **On 4th February 2017**
A's Books:
- Cash/Bank | 29,400
- Discount Allowed | 600
- Bills Receivable (B) | 30,000
4. **On 4th February 2017**
Bank's Books:
- Bills Receivable (B) | 30,000
- Noting Charges | 200
- Cash/Bank | 29,800
5. **On 4th April 2017**
A's Books:
- Accounts Receivable (B) | 30,804
- Interest Receivable | 804
- Interest Income | 804
B's Books:
- Bills Payable (A) | 30,804
- Interest Payable | 804
- Purchases | 30,000
- Interest Expense | 804
**Explanation of Dishonour of Bill**
When a bill of exchange is dishonored, it means that the party who accepted the bill (in this case, B) failed to make the payment on the due date. In this scenario, the acceptance was dishonored on the due date, leading to certain consequences.
1. Noting Charges:
- The bank, upon dishonor of the bill, pays the noting charges. These charges are the fees charged for recording the dishonor of the bill.
- In this case, the noting charges paid by the bank were Rs200.
2. Recording the Dishonored Bill:
- In A's books, the dishonored bill is debited to Bills Receivable account and credited to Accounts Receivable (B) account.
- In B's books, the dishonored bill is debited to Bills Payable (A) account and credited to Purchases account.
3. Acceptance of New Bill:
- In order to settle the outstanding amount, B accepts a new bill for the amount then due to A, along with interest.
- The amount of the new bill is Rs30,804, which includes the principal amount of Rs30,000 and the interest of Rs804.
- In A's books, the new bill is recorded as an increase in Accounts Receivable (B) and Interest Receivable accounts.
- In B's books, the new bill is recorded as an increase in Bills Payable (A) and Interest Payable accounts, while the interest expense is also accounted for.
By following these journal entries, the transactions related to the sale, dishonored bill, and acceptance of a new bill are accurately recorded in the books of A and B.
1. **On 1st January 2017**
A's Books:
- Accounts Receivable (B) | 30,000
- Sales | 30,000
B's Books:
- Purchases | 30,000
- Accounts Payable (A) | 30,000
2. **On 1st January 2017**
A's Books:
- Bills Receivable (B) | 30,000
- Accounts Receivable (B) | 30,000
B's Books:
- Bills Payable (A) | 30,000
- Accounts Payable (A) | 30,000
3. **On 4th February 2017**
A's Books:
- Cash/Bank | 29,400
- Discount Allowed | 600
- Bills Receivable (B) | 30,000
4. **On 4th February 2017**
Bank's Books:
- Bills Receivable (B) | 30,000
- Noting Charges | 200
- Cash/Bank | 29,800
5. **On 4th April 2017**
A's Books:
- Accounts Receivable (B) | 30,804
- Interest Receivable | 804
- Interest Income | 804
B's Books:
- Bills Payable (A) | 30,804
- Interest Payable | 804
- Purchases | 30,000
- Interest Expense | 804
**Explanation of Dishonour of Bill**
When a bill of exchange is dishonored, it means that the party who accepted the bill (in this case, B) failed to make the payment on the due date. In this scenario, the acceptance was dishonored on the due date, leading to certain consequences.
1. Noting Charges:
- The bank, upon dishonor of the bill, pays the noting charges. These charges are the fees charged for recording the dishonor of the bill.
- In this case, the noting charges paid by the bank were Rs200.
2. Recording the Dishonored Bill:
- In A's books, the dishonored bill is debited to Bills Receivable account and credited to Accounts Receivable (B) account.
- In B's books, the dishonored bill is debited to Bills Payable (A) account and credited to Purchases account.
3. Acceptance of New Bill:
- In order to settle the outstanding amount, B accepts a new bill for the amount then due to A, along with interest.
- The amount of the new bill is Rs30,804, which includes the principal amount of Rs30,000 and the interest of Rs804.
- In A's books, the new bill is recorded as an increase in Accounts Receivable (B) and Interest Receivable accounts.
- In B's books, the new bill is recorded as an increase in Bills Payable (A) and Interest Payable accounts, while the interest expense is also accounted for.
By following these journal entries, the transactions related to the sale, dishonored bill, and acceptance of a new bill are accurately recorded in the books of A and B.
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A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill?
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A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill?.
A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill?.
Solutions for A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? in English & in Hindi are available as part of our courses for Commerce.
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Here you can find the meaning of A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? defined & explained in the simplest way possible. Besides giving the explanation of
A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill?, a detailed solution for A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? has been provided alongside types of A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? theory, EduRev gives you an
ample number of questions to practice A sells goods for Rs30,000 to B on 1st january ,2017 and on the same day draws a bill on B at three months for the amount .B accepts it and returns it to A ,who discounts it on 4th february , 2017 with his bank at 18%per annum . The acceptance is dishonoured on the due date ,the noting charges paid by the bank being Rs200.On 4th April ,2017,B accepts a new bill at two months for the amount then due to A together with interest at 12% per annum.Make journal enteries to record these transactions in the books of A and B .Hint=Amount of the new bill=Rs30,804 Related: Dishonour of Bill? tests, examples and also practice Commerce tests.
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