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On 1st January 2018 Ram drew a bill for rs 5000 for 4 month on Basant who accepted the bill on 4th January Ram discounts the bill with His Banker at 6 percent per annum in person is unable to meet the bill on the due date and the bill is dishonoured pass journal entries in the books of Ram and Basant?
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On 1st January 2018 Ram drew a bill for rs 5000 for 4 month on Basant ...
Journal Entries in the Books of Ram and Basant

Bill Drawn and Accepted
- Ram's Books:
- Debit: Basant's Account - Rs 5000
- Credit: Bills Receivable Account - Rs 5000
- Basant's Books:
- Debit: Bills Payable Account - Rs 5000
- Credit: Ram's Account - Rs 5000

Bill Discounted
- Ram's Books:
- Debit: Bank Account - Rs 97.50 (6% of Rs 5000 for 4 months)
- Credit: Discount on Bills Account - Rs 97.50
- Credit: Bills Receivable Account - Rs 4902.50 (Rs 5000 - Rs 97.50)
- Bank's Books:
- Debit: Bills Receivable Account - Rs 4902.50
- Credit: Ram's Account - Rs 4902.50

Bill Dishonoured
- Ram's Books:
- Debit: Basant's Account - Rs 5000
- Debit: Bank Account - Rs 97.50
- Debit: Expenses Account (Dishonour Charges) - Rs X (as per bank charges)
- Credit: Bills Receivable Account - Rs 5000
- Basant's Books:
- Debit: Ram's Account - Rs 5000
- Credit: Bills Payable Account - Rs 5000

Explanation
- The first entry is made in both the books when the bill is drawn and accepted.
- The next entry is made when the bill is discounted with the bank. Ram receives Rs 4902.50 from the bank after deducting 6% interest for 4 months.
- The last entry is made when the bill is dishonoured as Basant is unable to meet the payment. Ram's account is debited with the bill amount, interest, and dishonour charges. Basant's account is also debited with the bill amount.
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On 1st January 2018 Ram drew a bill for rs 5000 for 4 month on Basant who accepted the bill on 4th January Ram discounts the bill with His Banker at 6 percent per annum in person is unable to meet the bill on the due date and the bill is dishonoured pass journal entries in the books of Ram and Basant?
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On 1st January 2018 Ram drew a bill for rs 5000 for 4 month on Basant who accepted the bill on 4th January Ram discounts the bill with His Banker at 6 percent per annum in person is unable to meet the bill on the due date and the bill is dishonoured pass journal entries in the books of Ram and Basant? for Class 11 2024 is part of Class 11 preparation. The Question and answers have been prepared according to the Class 11 exam syllabus. Information about On 1st January 2018 Ram drew a bill for rs 5000 for 4 month on Basant who accepted the bill on 4th January Ram discounts the bill with His Banker at 6 percent per annum in person is unable to meet the bill on the due date and the bill is dishonoured pass journal entries in the books of Ram and Basant? covers all topics & solutions for Class 11 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On 1st January 2018 Ram drew a bill for rs 5000 for 4 month on Basant who accepted the bill on 4th January Ram discounts the bill with His Banker at 6 percent per annum in person is unable to meet the bill on the due date and the bill is dishonoured pass journal entries in the books of Ram and Basant?.
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