Question

Bills discounted dishonoured not recorded in cash book

Answer 1

Bills discounted dishonored

• Bill Discounted and Dishonored is the case where the opening balance of the Cash account is given and the amount of bill discounted and dishonored shall be deducted from the same.
• That is because dishonor or cancellation of bills results in a decrease in the balance of the Pass Book as the amount is reduced.
• However, no record is made in the Cash Book as the whole of this transaction is related to the band and does not affect Cash.

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Answer 2

Answer:

• Bill Discounted and Dishonored is that case where the opening balance of the Cash account is given.
• The particular amount of bill discounted and dishonored must be subtracted from the same.
• The main reason behind this fact is that the cancellation or dishonor of bills causes a deduction in the balance of the Passbook because the amount is decreased or reduced.
• No specific record is made in the Cashbook.
• The whole of this transaction is related to the band thereby it does not have any effect on Cash.

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