on 10th march,2019, A draws on B a bill at 3 months for 20000 which B accepts immediately and returns to A. The bill is honoured on due date. pass necessary journal entries in the books of both the parties.
Answers
The necessary journal entries will be -
- In the books Of A
March 10 - Bill Receivable Dr. 20,000
To B's A/c Cr, 20,000
June 13 - Cash A/c Dr. 20,000
To Bill Receivable Dr. 20,000
- In the books Of B
March 10 - A A/c Dr. 20,000
To Bills payable A/c Cr, 20,000
June 13 - Bill payable A/c Dr. 20,000
To Cash A/c Dr. 20,000
The journal entries in the books of A and B are shown below:
Explanation:
The necessary journal entries are as follows: -
In the books Of A
March 10
Bill Receivable A/c....................Dr 20,000
To B's A/c................................... Cr 20,000
Being acceptance was received by B on the bill
June 13
Cash A/c .............................Dr 20,000
To Bill Receivable A/c........Cr 20,000
Being cash received against the bill
In the books Of B
March 10
A A/c................................... Dr 20,000
To Bills payable A/c............Cr 20,000
Being bill is accepted and acceptance is provided to A
June 13
Bill payable A/c..........................Dr 20,000
To Cash A/c...............................Cr 20,000
Being cash paid against the bill
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