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A bill for 500 due from Mr.A previously discounted for Rs. 484 was dishonoured and the bank debited to account but no entry was made in cash book?
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A bill for 500 due from Mr.A previously discounted for Rs. 484 was dis...
Explanation:


Dishonoured Bill:

When a bill is dishonoured, it means that the party who is supposed to make the payment has failed to do so. In this case, Mr. A was supposed to pay a bill of Rs. 500, but he did not make the payment on the due date.

Discounted Bill:

The bill was previously discounted for Rs. 484. This means that Mr. A had approached a bank or financial institution to get the bill discounted. The bank paid him Rs. 484 in advance and took over the responsibility of collecting the payment from the debtor on the due date.

Bank Debit:

Since the bill was dishonoured, the bank debited Mr. A's account. This means that the bank deducted the amount of the bill from Mr. A's account. The bank does this to recover the amount it had paid to Mr. A when the bill was discounted.

Cash Book Entry:

However, it is mentioned that no entry was made in the cash book regarding this transaction. This could be due to various reasons:

1. Oversight: It is possible that the person responsible for maintaining the cash book simply forgot to make the entry. This could happen if there was a high volume of transactions or if there was a lack of attention to detail.

2. Error: Another possibility is that there was an error or mistake while recording the transaction in the cash book. This could be a result of human error or a misunderstanding of the transaction.

3. Fraud: In some cases, the absence of an entry in the cash book could be an indication of fraud or embezzlement. Someone may have intentionally omitted the entry to conceal the transaction and misappropriate funds.

It is important to rectify this error or omission in the cash book. The correct entry should be made to reflect the dishonoured bill and the subsequent debit to Mr. A's account. This will ensure that the cash book accurately reflects the financial transactions and maintain the integrity of the accounting records.
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A bill for 500 due from Mr.A previously discounted for Rs. 484 was dishonoured and the bank debited to account but no entry was made in cash book?
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A bill for 500 due from Mr.A previously discounted for Rs. 484 was dishonoured and the bank debited to account but no entry was made in cash book? 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 A bill for 500 due from Mr.A previously discounted for Rs. 484 was dishonoured and the bank debited to account but no entry was made in cash book? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A bill for 500 due from Mr.A previously discounted for Rs. 484 was dishonoured and the bank debited to account but no entry was made in cash book?.
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