Revision Test - Bill of Exchange Notes - Class 11

 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