Question 41.
Y purchased goods for ₹ 6,000 on 1st June, 2011 from X and on the same date accepted a bill payable after three months. 3 days later, X
endorsed the bill to Z. On maturity, the bill was dishonoured for non-payment and Z had to pay ₹ 50 as noting charges. Two days after the dishonour of bill, Y paid ₹ 2,000 to X and requested him to draw a second bill for the balance plus ₹ 90 for the amount of interest, payable after two months. X accepted the proposal and draws the bill on Y, which was accepted by Y and was duly met on maturity.
Pass Journal entries for the above transactions in the books of X.
Answers
The journal entries in the books of X
Explanation:
The journal entries in the books of X are as:
2011
June 1
Y's A/c.................................Dr Rs 6,000
To Sales A/c....................Cr Rs 6,000
Being goods sold to Y
June 1
Bills Receivable A/c...........................Dr Rs 6,000
To Y's A/c.........................................Cr Rs 6,000
Being Y accepted the bill
June 4
Z's A/c.......................................Dr Rs 6,000
To Bills Receivable A/c...........Cr Rs 6,000
Being bill endorsed to Z
September 4
Y's A/c...............................Dr Rs 6,050
To Z's A/c........................Cr Rs 6,050
Being bill endorsed dishonoured and noting charges are paid
September 6
Cash A/c...........................Dr Rs 2,000
Bills Receivable A/c.......Dr Rs 4,140
To Y's A/c.......................Cr Rs 6,050
To Interest A/c...............Cr Rs 90
Being 2,000 amount is received and for remaining balance, the new bill is issued with interest
November 9
Cash A/c...............................Dr Rs 4,140
To Bills Receivable A/c.....Cr Rs 4,140
Being bill met on due date
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