Page 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 1
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
Page 2
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 1
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 2
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 2
MM: 22
Q 1: Mahesh drew a bill on Suresh on 7
th
Jan. 2005 for Rs. 900 payable after 3 months. After acceptance
the bill was endorsed to Ramesh who discounted it with his bank on 10
th
Jan. @ 8% p.a. On the due
date, the bill was dishonoured and Rs. 10 were paid as noting charges.
Mahesh paid off Ramesh’s due in full and on Suresh’s request drew on his a new bill for 3 months
adding interest Rs. 24 and noting charges.
Before the due date, Suresh became insolvent and 50 paise in a rupee only could be realized from his
estate.
Pass journal entries in the books of Mahesh, and Ramesh. 7
Q 2: Before the due date of the bill for Rs. 300:
1. X, the acceptor approaches us and pays Rs. 100 in cash and asks us to draw on him another bill
Rs. 215, Rs. 15 being for interest and we agree to it:
Pass journal entries in our books. 2
Q 3: On 15
th
April, 2005, A agrees to draw o B who is this debtors for Rs. 2, 400 three bill of exchange No
1 for Rs. 700 at one month; No 2 for Rs. 800 at two months and No 3 for Rs. 900 at three months, B
accepts and returns these bills to A. A endorses on 20
th
April the first bill to his creditor C in full
settlement of an account of Rs. 710; discount on 22
nd
April the second bill at the bank for Rs. 792 and
retains the third bill till maturity.
The first bill is met at maturity. The second bill dishonoured on the due date, Rs. 10 being paid for
noting charges. A charges B Rs. 15 for interest and draws on him a fourth bill for Rs. 825 at three
months. The third and fourth bills are duly honoured on the due dates.
Give journal entries to record these transaction in the books of A. 6
Q 4: Q drew a bill of exchange on P for Rs. 4, 000 on 1
st
May, 2005 for 3 months. P returned the bill to Q
after accepting it. Q discounted the bill at his bank for Rs. 3, 900. Just before the due date P
approached Q for the renewal of the bill. Q agreed on conditions that Rs. 1, 000 plus interest on the
renewal of the bill. Q agreed on conditions that Rs. 1, 000 Plus interest on the balance at 6% per
annum for 3 months be paid in cash immediately and a new bill for 3 months be drawn for the
remaining balance. These conditions were carried through. On 7
th
November, 2005 P became
insolvent and his estate paid 40 paise in rupee in full settlement. Give journal entries in the book of
Q. 6
Q 5: Mention any two difference between a promissory note and a bill of exchange. 1
Page 3
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 1
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 2
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 2
MM: 22
Q 1: Mahesh drew a bill on Suresh on 7
th
Jan. 2005 for Rs. 900 payable after 3 months. After acceptance
the bill was endorsed to Ramesh who discounted it with his bank on 10
th
Jan. @ 8% p.a. On the due
date, the bill was dishonoured and Rs. 10 were paid as noting charges.
Mahesh paid off Ramesh’s due in full and on Suresh’s request drew on his a new bill for 3 months
adding interest Rs. 24 and noting charges.
Before the due date, Suresh became insolvent and 50 paise in a rupee only could be realized from his
estate.
Pass journal entries in the books of Mahesh, and Ramesh. 7
Q 2: Before the due date of the bill for Rs. 300:
1. X, the acceptor approaches us and pays Rs. 100 in cash and asks us to draw on him another bill
Rs. 215, Rs. 15 being for interest and we agree to it:
Pass journal entries in our books. 2
Q 3: On 15
th
April, 2005, A agrees to draw o B who is this debtors for Rs. 2, 400 three bill of exchange No
1 for Rs. 700 at one month; No 2 for Rs. 800 at two months and No 3 for Rs. 900 at three months, B
accepts and returns these bills to A. A endorses on 20
th
April the first bill to his creditor C in full
settlement of an account of Rs. 710; discount on 22
nd
April the second bill at the bank for Rs. 792 and
retains the third bill till maturity.
The first bill is met at maturity. The second bill dishonoured on the due date, Rs. 10 being paid for
noting charges. A charges B Rs. 15 for interest and draws on him a fourth bill for Rs. 825 at three
months. The third and fourth bills are duly honoured on the due dates.
Give journal entries to record these transaction in the books of A. 6
Q 4: Q drew a bill of exchange on P for Rs. 4, 000 on 1
st
May, 2005 for 3 months. P returned the bill to Q
after accepting it. Q discounted the bill at his bank for Rs. 3, 900. Just before the due date P
approached Q for the renewal of the bill. Q agreed on conditions that Rs. 1, 000 plus interest on the
renewal of the bill. Q agreed on conditions that Rs. 1, 000 Plus interest on the balance at 6% per
annum for 3 months be paid in cash immediately and a new bill for 3 months be drawn for the
remaining balance. These conditions were carried through. On 7
th
November, 2005 P became
insolvent and his estate paid 40 paise in rupee in full settlement. Give journal entries in the book of
Q. 6
Q 5: Mention any two difference between a promissory note and a bill of exchange. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 3
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1(SOL)
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
Page 4
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 1
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 2
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 2
MM: 22
Q 1: Mahesh drew a bill on Suresh on 7
th
Jan. 2005 for Rs. 900 payable after 3 months. After acceptance
the bill was endorsed to Ramesh who discounted it with his bank on 10
th
Jan. @ 8% p.a. On the due
date, the bill was dishonoured and Rs. 10 were paid as noting charges.
Mahesh paid off Ramesh’s due in full and on Suresh’s request drew on his a new bill for 3 months
adding interest Rs. 24 and noting charges.
Before the due date, Suresh became insolvent and 50 paise in a rupee only could be realized from his
estate.
Pass journal entries in the books of Mahesh, and Ramesh. 7
Q 2: Before the due date of the bill for Rs. 300:
1. X, the acceptor approaches us and pays Rs. 100 in cash and asks us to draw on him another bill
Rs. 215, Rs. 15 being for interest and we agree to it:
Pass journal entries in our books. 2
Q 3: On 15
th
April, 2005, A agrees to draw o B who is this debtors for Rs. 2, 400 three bill of exchange No
1 for Rs. 700 at one month; No 2 for Rs. 800 at two months and No 3 for Rs. 900 at three months, B
accepts and returns these bills to A. A endorses on 20
th
April the first bill to his creditor C in full
settlement of an account of Rs. 710; discount on 22
nd
April the second bill at the bank for Rs. 792 and
retains the third bill till maturity.
The first bill is met at maturity. The second bill dishonoured on the due date, Rs. 10 being paid for
noting charges. A charges B Rs. 15 for interest and draws on him a fourth bill for Rs. 825 at three
months. The third and fourth bills are duly honoured on the due dates.
Give journal entries to record these transaction in the books of A. 6
Q 4: Q drew a bill of exchange on P for Rs. 4, 000 on 1
st
May, 2005 for 3 months. P returned the bill to Q
after accepting it. Q discounted the bill at his bank for Rs. 3, 900. Just before the due date P
approached Q for the renewal of the bill. Q agreed on conditions that Rs. 1, 000 plus interest on the
renewal of the bill. Q agreed on conditions that Rs. 1, 000 Plus interest on the balance at 6% per
annum for 3 months be paid in cash immediately and a new bill for 3 months be drawn for the
remaining balance. These conditions were carried through. On 7
th
November, 2005 P became
insolvent and his estate paid 40 paise in rupee in full settlement. Give journal entries in the book of
Q. 6
Q 5: Mention any two difference between a promissory note and a bill of exchange. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 3
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1(SOL)
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 4
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 2 (SOL)
MM: 22
Q 1: Mahesh drew a bill on Suresh on 7
th
Jan. 2005 for Rs. 900 payable after 3 months. After acceptance
the bill was endorsed to Ramesh who discounted it with his bank on 10
th
Jan. @ 8% p.a. On the due
date, the bill was dishonoured and Rs. 10 were paid as noting charges.
Mahesh paid off Ramesh’s due in full and on Suresh’s request drew on his a new bill for 3 months
adding interest Rs. 24 and noting charges.
Before the due date, Suresh became insolvent and 50 paise in a rupee only could be realized from his
estate.
Pass journal entries in the books of Mahesh, and Ramesh. 7
Sol: Mahesh Journal entries
Date Particulars Dr. Rs. Cr. Rs.
7.1.05
10.4.5
13.7.5
B/R Dr.
To Suresh
Ramesh Dr.
To B/R
Suresh Dr.
To Ramesh
Suresh Dr.
To Ramesh
Ramesh Dr.
To Cash
Suresh Dr.
To Int.
B/R Dr.
To Suresh
Suresh Dr.
To B/R
Cash Dr.
Bad Debts Dr.
To Suresh
900
900
900
10
910
24
934
934
467
467
900
900
900
10
910
24
934
934
934
Ramesh Journal Entries
Date Particulars Dr. Rs. Cr. Rs.
7.1.05
10.1.5
10.4.5
B/R Dr.
To Mahesh
Bank Dr.
Discount Dr.
To B/R
Mahesh Dr.
To Bank
Mahesh Dr.
To Bank
Cash Dr.
To Mahesh
900
882
10
900
10
910
900
900
900
10
910
Page 5
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 1
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 2
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 2
MM: 22
Q 1: Mahesh drew a bill on Suresh on 7
th
Jan. 2005 for Rs. 900 payable after 3 months. After acceptance
the bill was endorsed to Ramesh who discounted it with his bank on 10
th
Jan. @ 8% p.a. On the due
date, the bill was dishonoured and Rs. 10 were paid as noting charges.
Mahesh paid off Ramesh’s due in full and on Suresh’s request drew on his a new bill for 3 months
adding interest Rs. 24 and noting charges.
Before the due date, Suresh became insolvent and 50 paise in a rupee only could be realized from his
estate.
Pass journal entries in the books of Mahesh, and Ramesh. 7
Q 2: Before the due date of the bill for Rs. 300:
1. X, the acceptor approaches us and pays Rs. 100 in cash and asks us to draw on him another bill
Rs. 215, Rs. 15 being for interest and we agree to it:
Pass journal entries in our books. 2
Q 3: On 15
th
April, 2005, A agrees to draw o B who is this debtors for Rs. 2, 400 three bill of exchange No
1 for Rs. 700 at one month; No 2 for Rs. 800 at two months and No 3 for Rs. 900 at three months, B
accepts and returns these bills to A. A endorses on 20
th
April the first bill to his creditor C in full
settlement of an account of Rs. 710; discount on 22
nd
April the second bill at the bank for Rs. 792 and
retains the third bill till maturity.
The first bill is met at maturity. The second bill dishonoured on the due date, Rs. 10 being paid for
noting charges. A charges B Rs. 15 for interest and draws on him a fourth bill for Rs. 825 at three
months. The third and fourth bills are duly honoured on the due dates.
Give journal entries to record these transaction in the books of A. 6
Q 4: Q drew a bill of exchange on P for Rs. 4, 000 on 1
st
May, 2005 for 3 months. P returned the bill to Q
after accepting it. Q discounted the bill at his bank for Rs. 3, 900. Just before the due date P
approached Q for the renewal of the bill. Q agreed on conditions that Rs. 1, 000 plus interest on the
renewal of the bill. Q agreed on conditions that Rs. 1, 000 Plus interest on the balance at 6% per
annum for 3 months be paid in cash immediately and a new bill for 3 months be drawn for the
remaining balance. These conditions were carried through. On 7
th
November, 2005 P became
insolvent and his estate paid 40 paise in rupee in full settlement. Give journal entries in the book of
Q. 6
Q 5: Mention any two difference between a promissory note and a bill of exchange. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 3
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 1(SOL)
MM: 22
Q 1: On 01.10.05. X sells goods to Y for Rs. 25, 000 and draws two bills of exchange on him: the first for
Rs. 10, 000 for two months and second for Rs. 15, 000 for 3 months. Y accepts and returns these bills
to X Both the bill are sent to the bank for collection. In due course X receives the information from
the bank that the bill for Rs. 10, 000 has been duly met and the other bill for Rs. 15, 000 has been
dishonoured. Noting charges paid on the dishonour of the second bill are Rs. 100. Pass Journal
entries in the book of X. 6
Q 2: Journalise the following in the books of Harish. Harish sends Hari’s acceptance for Rs. 26, 000 to
Harsh to meet his acceptance to the like amount in favour of Harsh. 2
Q 3: Journalise the following in the book of Hari. Sohan inform Hari that Mohan’s acceptance for Rs.
13, 000 endorsed in favour of Sohan by Hari, has been dishonoured, noting charge Rs. 200. Sohan
agrees to accept Rs. 3, 000 in cash and acceptance at 3 months together with interest @ 12%. 4
Q 4: Rajan owed Rs. 16, 000 to Arvind. Arvind draws two bills of Exchange on Jan. 1, 2006 for Rs. 6, 000
and Rs. 10, 000. The bill of exchange for Rs. 6, 000 is for two months while the bills of Exchange Rs.
10, 000 is for three months. These bills are accepted by Rajan. On March 4, 2006 Rajan requested
Arvind to renew the first bill with interest at 18% p.a. for a period of two months. Arvind agrees to
this proposal. On March 20, 2006 Rajan retires the acceptance for Rs. 10, 000, the interest rebate, i.e.
discount being Rs. 100. Before the due date of the renewal bill, Rajan became insolvent and 40% of
the amount could be recovered from his estate. You are to give the journal entries in the book of
Rajan and Arvind. 9
Q 5: Mention any two difference between Trade Bills and Accommodation bills. 1
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 4
REVISION TEST – 2 (2011 - 2012)
BILLS OF EXCHANGE
SET – 2 (SOL)
MM: 22
Q 1: Mahesh drew a bill on Suresh on 7
th
Jan. 2005 for Rs. 900 payable after 3 months. After acceptance
the bill was endorsed to Ramesh who discounted it with his bank on 10
th
Jan. @ 8% p.a. On the due
date, the bill was dishonoured and Rs. 10 were paid as noting charges.
Mahesh paid off Ramesh’s due in full and on Suresh’s request drew on his a new bill for 3 months
adding interest Rs. 24 and noting charges.
Before the due date, Suresh became insolvent and 50 paise in a rupee only could be realized from his
estate.
Pass journal entries in the books of Mahesh, and Ramesh. 7
Sol: Mahesh Journal entries
Date Particulars Dr. Rs. Cr. Rs.
7.1.05
10.4.5
13.7.5
B/R Dr.
To Suresh
Ramesh Dr.
To B/R
Suresh Dr.
To Ramesh
Suresh Dr.
To Ramesh
Ramesh Dr.
To Cash
Suresh Dr.
To Int.
B/R Dr.
To Suresh
Suresh Dr.
To B/R
Cash Dr.
Bad Debts Dr.
To Suresh
900
900
900
10
910
24
934
934
467
467
900
900
900
10
910
24
934
934
934
Ramesh Journal Entries
Date Particulars Dr. Rs. Cr. Rs.
7.1.05
10.1.5
10.4.5
B/R Dr.
To Mahesh
Bank Dr.
Discount Dr.
To B/R
Mahesh Dr.
To Bank
Mahesh Dr.
To Bank
Cash Dr.
To Mahesh
900
882
10
900
10
910
900
900
900
10
910
XI / XII ACCOUNTS ECONOMICS BUSINESS STUDIES 5
Q 2: Before the due date of the bill for Rs. 300:
1. X, the acceptor approaches us and pays Rs. 100 in cash and asks us to draw on him another bill
Rs. 215, Rs. 15 being for interest and we agree to it:
Pass journal entries in our books. 2
Sol: Journal Entries
Date Particulars Dr. Rs. Cr. Rs.
X Dr.
To B/R
Cash Dr.
To X
X Dr.
To Int.
B/R Dr.
To X
300
100
15
215
300
100
15
215
Q 3: On 15
th
April, 2005, A agrees to draw o B who is this debtors for Rs. 2, 400 three bill of exchange No
1 for Rs. 700 at one month; No 2 for Rs. 800 at two months and No 3 for Rs. 900 at three months, B
accepts and returns these bills to A. A endorses on 20
th
April the first bill to his creditor C in full
settlement of an account of Rs. 710; discount on 22
nd
April the second bill at the bank for Rs. 792 and
retains the third bill till maturity.
The first bill is met at maturity. The second bill dishonoured on the due date, Rs. 10 being paid for
noting charges. A charges B Rs. 15 for interest and draws on him a fourth bill for Rs. 825 at three
months. The third and fourth bills are duly honoured on the due dates.
Give journal entries to record these transaction in the books of A. 6
Sol: Journal Entries of Books of A
Date Particulars Dr. Rs. Cr. Rs.
15.4.05
20.4.05
22.4.05
15.6.05
18.7.05
21.9.05
B/R 1 Dr.
B/R 2 Dr.
B/R 3 Dr.
To B
C Dr.
To B/R1
To Discount
Bank Dr.
Discount Dr.
To B/R2
B Dr
To Bank
B Dr.
To Bank
B Dr.
To int.
B/R4 Dr.
To B
Cash Dr.
To B/R3
Cash Dr.
To B/R4
700
800
900
710
792
8
800
10
15
825
900
825
2, 400
700
10
800
800
10
15
825
900
825
Q 4: Q drew a bill of exchange on P for Rs. 4, 000 on 1
st
May, 2005 for 3 months. P returned the bill to Q
after accepting it. Q discounted the bill at his bank for Rs. 3, 900. Just before the due date P
approached Q for the renewal of the bill. Q agreed on conditions that Rs. 1, 000 plus interest on the
renewal of the bill. Q agreed on conditions that Rs. 1, 000 Plus interest on the balance at 6% per
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