Karthik accepted a bill for Rs. 20,000/- drawn by Jones at three months. Jones got the bill discounted with his bank for Rs. 19,900. Before the due date Karthik approached Jones for renewal of the bill. Jones agreed on the condition that Rs. 10,000/- be paid immediately together with interest on the remaining amount at 6% p.a. For balance Karthik should accept a new bill for three months. These arrangements were carried through but afterwards, Karthik become Insolvent and only 80 % of the amount could be recovered from his estate. Give journal entries in the books of Karthik.

Journal Entries in the Books of Karthik

       

Date	Particulars	LF	Debit (Rs)	Credit (Rs)
1	Jones A/c ....Dr.		20000
	To Bills Payable A/c			20000
	[Being the bill is accepted]
2	Bills Payable A/c ....Dr.		20000
	To Jones A/c			20000
	[Being the bill is dishonoured]
3	Interest A/c ....Dr.		150
	To Jones's A/c			150
	[Being the interest is charged]
4	Jones A/c ....Dr.		10150
	To Bank A/c			10150
	[Being the part payment is made along with interest]
5	Jones A/c ....Dr.		10000
	To Bills Payable A/c			10000
	[Being the new bill is accepted]
6	Bills payable A/c ....Dr.		10000
	To Jones's A/c			10000
	[Being the new bill is dishonoured]
7	Jones's A/c ....Dr.		10000
	To Bank A/c			8000
	To Deficiency A/c			2000
	[being the drawee become insolvent and only 80% of the amount could be recovered from her estate]