CA Foundation Exam > CA Foundation Questions > Mr Bobby sold goods worth Rs 25000 to Mr Bonn...
Start Learning for Free
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too?
Most Upvoted Answer
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately ...
Calculating Bad Debt for Mr. Bobby
Step 1: Calculating the Due Date
The bill was accepted on 1.11.2011 and was payable after 2 months. Therefore, the due date would be 1.1.2012.
Step 2: Discounting the Bill
Mr. Bobby discounted the bill @18% p.a on 15.11.2011. Therefore, the proceeds received by Mr. Bobby would be:
Discount = (25000 * 18 * 45) / (365 * 100) = Rs. 740.41
Proceeds = Bill Amount - Discount = Rs. 25000 - Rs. 740.41 = Rs. 24259.59
Step 3: Recording the Transaction
The following journal entry would be passed to record the transaction:
Debit: Bank Account - Rs. 24259.59
Credit: Bills Receivable Account - Rs. 25000
Credit: Discount Account - Rs. 740.41
Step 4: Recording the Bad Debt
As Mr. Bonny failed to discharge the bill and later became insolvent, Mr. Bobby can consider the bill as a bad debt. Since 50 paisa is recovered from Bonny's estate, the amount of bad debt would be:
Bad Debt = Bill Amount - Amount Recovered = Rs. 25000 - Rs. 0.50 = Rs. 24999.50
The following journal entry would be passed to record the bad debt:
Debit: Bad Debt Account - Rs. 24999.50
Credit: Bills Receivable Account - Rs. 24999.50
Step 5: Finalizing the Books
After passing the above journal entries, Mr. Bobby's books would be finalized. The Bank Account would show a credit balance of Rs. 24259.59, the Discount Account would show a debit balance of Rs. 740.41, and the Bad Debt Account would show a debit balance of Rs. 24999.50.
Step 1: Calculating the Due Date
The bill was accepted on 1.11.2011 and was payable after 2 months. Therefore, the due date would be 1.1.2012.
Step 2: Discounting the Bill
Mr. Bobby discounted the bill @18% p.a on 15.11.2011. Therefore, the proceeds received by Mr. Bobby would be:
Discount = (25000 * 18 * 45) / (365 * 100) = Rs. 740.41
Proceeds = Bill Amount - Discount = Rs. 25000 - Rs. 740.41 = Rs. 24259.59
Step 3: Recording the Transaction
The following journal entry would be passed to record the transaction:
Debit: Bank Account - Rs. 24259.59
Credit: Bills Receivable Account - Rs. 25000
Credit: Discount Account - Rs. 740.41
Step 4: Recording the Bad Debt
As Mr. Bonny failed to discharge the bill and later became insolvent, Mr. Bobby can consider the bill as a bad debt. Since 50 paisa is recovered from Bonny's estate, the amount of bad debt would be:
Bad Debt = Bill Amount - Amount Recovered = Rs. 25000 - Rs. 0.50 = Rs. 24999.50
The following journal entry would be passed to record the bad debt:
Debit: Bad Debt Account - Rs. 24999.50
Credit: Bills Receivable Account - Rs. 24999.50
Step 5: Finalizing the Books
After passing the above journal entries, Mr. Bobby's books would be finalized. The Bank Account would show a credit balance of Rs. 24259.59, the Discount Account would show a debit balance of Rs. 740.41, and the Bad Debt Account would show a debit balance of Rs. 24999.50.
Community Answer
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately ...
First, Bobby sold to goods Mr Bonny 25000. after that he discounted the bill at 18% but , this will not make any difference in Bonnie's book. after Bonny became insoluent so he can give only 50% of 25000 is 12,500 so, this amount of bad debt will be recorded in the books of Bobby.
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too?
Question Description
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? 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 Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too?.
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? 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 Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too?.
Solutions for Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? defined & explained in the simplest way possible. Besides giving the explanation of
Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too?, a detailed solution for Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? has been provided alongside types of Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? theory, EduRev gives you an
ample number of questions to practice Mr Bobby sold goods worth Rs 25000 to Mr Bonnyrigg. Bonny immediately accepted the bill on 1.11.2011 payable after 2 months later. Bobby discounted the bill @18% p.a on 15.11.2011. On the due date Bonny failed to discharge the bill. Later on Bonny became insolvent and 50 paisa is recovered from Bonny's estate. How much amount of bad debt will be recorded in the books of Bobby. please do help and do show the steps too? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup