Question

23. Mehak sold goods for Rs. 24, 000 to Shally on July 31, 2017 and drew three bills for Rs. 6, 000, Rs. 8, 000 and Rs. 10,000 payable after two, three and four months respectively. The first bill was kept by Mehak with her till maturity date. She endorsed the second bill in favor of her creditor Kanak. The third bill was discounted on September 3, 2017 @ 12% p. a. from bank. The first and second bill were duly met on maturity but the third bill was dishonoured and the bank paid Rs. 150 as noting charges. On December 3, 2017 Shally paid Rs. 5,000 and noting charges in cash and accepted a new bill at two months after date for the balance amount plus interest Rs. 200. The new bill was met on maturity by Shally. . You are required to give the Journal Entries in the books of Mehak. (8)​

Answer 1

Answer:

shally a/c dr

to sales a/c

being goods sold to shally on cr

Answer 2

Journal Entries for the given transactions

Explanation:

                                            In The Books of Mehak

Journal Entries:

•       Shally A/c      Dr. Rs.24,000

                    To Sales A/c          Rs.24,000

       (Being goods sold to Shally on credit)

•       Bills Receivable A/c (1)   Dr. Rs.6,000

                 Bills Receivable A/c(2)  Dr.Rs.8,000

                 Bills Receivable A/c(3)   Dr. Rs.10,000

                            To Shally A/c                   Rs.24,000

                  (Being Bills drawn on Shally)

•       Kanak A/c    Dr. Rs.8,000

                        To B/R A/c(2)     Rs.8,000

                 (Being B/R endorsed to creditor)

•        Discounting charges A/c Dr. Rs.286

                        To B/R A/c(3)                             Rs.10,000

               (Being B/R 3 discounted with bank @12% p.a for 87 days)

*Discounting Charges = $10,000 \times \dfrac{12}{100} \times \dfrac{87}{365}$ = Rs.286

•        Cash A/c      Dr. Rs.6,000

                       To B/R A/c(1)      Rs.6,000

              (Being cash received for B/R 1)

• Shally A/c       Dr. Rs.10,150

                 To B/R A/c (3)                 Rs.10,000

                  To Bank A/c                   Rs.150

 (Being B/R 3 dishonored and noting charges paid)

• Cash A/c         Dr. Rs.5150

              To Shally A/c          Rs.5150

       (Being cash paid by Shally along with Noting charges)

• Bills Receivable A/c(4)  Dr. Rs.5200

              To Shally A/c                     Rs.5200

     (Being a new bill drawn on Shally with interest of Rs.200)

• Cash A/c          Dr. Rs.5200

          To B/R A/c(4)           Rs.5200

            (Being cash for bill drawn on Shally satisfied)