Question

Vishal sold goods for Rs.7,000 to Manju on Jan 05, 2016 and drew upon
her a bill of exchange payable after 2 months, Manju accepted Vishal's
draft and handed over the same to Vishal after acceptance. Vishal
immediately discounted the bill with his bank@12% p.a. On the due
date Manju met her acceptance.
Journalise the above transactions in the books of Vishal and Manju.​

Answer 1

Answer:

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Explanation:

In the Books of Vishal

Journal Entries

Date Particulars LF Amt.(Dr) Amt.(Cr)

2011    

Jan 5 Manju                           Dr

To Sales A/c

(Being goods sold to Manju)

7,000 7,000

Jan 5 Bills Receivable A/c                   Dr

To Manju

(Being acceptance received)

7,000 7,000

Jan 5 Bank A/c                  Dr

Discount A/c               Dr

To Bills Receivable A/c

(Being Bill discounted with the bank at the rate of 12% per annum)

6,860

140

7,000

Working Note

Calculation of Interest=7,000×  

100

12

​  

×  

12

2

​  

=Rs. 140

In the Books of Manju

Journal Entries

Date Particulars LF Amt.(Dr) Amt.(Cr)

2011    

Jan 5 Purchase A/c               Dr

To Vishal

(Being goods purchased from Vishal)

7,000 7,000

Jan 1 Vishal                   Dr

To Bills Payable A/c

(Being acceptance given)

7,000 7,000

Mar 8 Bills Payable A/c                           Dr

To Bank A/c

(Being bills payable paid on maturity)

7,000 7,000