Question

on January 1st,1997 saju accepted a bill drawn on him by ritu for rs 5000 payable 4months after sight,against hus dues having surplus funds ,saju paid off the bill on 4th February and was allowed a rebate of 6% p.a show journal entries in the books of saju and ritu​

Answer 1

Answer:

In books of Ritu

1997

jan.1. Bills receivable a/c Dr 5000

To Saju. 5000

4feb. cash a,/c. Dr 4925

Rebate on bill a/c Dr 75

To Bill receivable a,/c. 5000

Rebate on bill = 5000×6/100×3/12=75

As Saju made payment three months earlier so rebate will calculate for 3months

In books of Saju

jan.1. Ritu Dr. 5000

To Bills payable a/c 5000

feb.4. Bill payable a/c. Dr 5000

To cash account. 4925

To rebate on bill a/c. 75