Question

rakesh accepted a bill for Rs 10000 drawn on him by mahesh accomodation mahehesh discounted the same with the bank for rs 10000 remitted half of the amount to rakesh on due date mahesh remitted amount to rakesh who honoured the bill on presentation pass the journal entry

Answer 1

Answer:

Explanation:

"Rakesh was in debt previously but has now paid off the debt and thus become a creditor. He ''Remitted'' cash on account meaning he paid the money back.

After the transaction both Rakesh and Mahesh will have their amount back and 'let's consider that Rakesh is a customer, then the journal entry would be as such,

Cash a/c Dr

Discount (if any)

To 'Mahesh's Account

"