Question

Q. 1            What journal entries will be made by the drawer in   his books when
  a.)  A bill is drawn  
     b.) A bill is discounted and   
       c.) A bill dishonoured and noting charges paid.
          d.) A bill is endorsed

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Answer 1

Answer:

option c is the correct answer

Answer 2

The journal entry that would be recorded in the book would be a bill dishonored and noting charges paid.

• This is because this transaction involves financial transactions.
• The basic definition of accounting stands as recording all the transactions which are financial in nature.
• Any other transaction which is not financial in nature but is important for the organisation would not be recorded in the books of accounts.
• Journal is the first book of accounts where the transactions are recorded. The transactions are then classified and posted under the respective ledger accounts.