Baloo owes Kaloo Rs.8000. Kaloo then draws a bill for Rs. 8000 on Baloo
for a period of three months. Baloo accepts and return it to Kaloo. Kaloo
discounted the bill with his bank @ 12 % p.a. On due date, the bill was
dishonoured noting charges amount to Rs. 30. Kaloo then draws a bill for the
balance plus interest of Rs. 170. Before the due date of this bill Baloo pays
the amount at a discount of Rs. 40 to retire the bill. Pass Journal Entries in
the books of Kaloo.
Solution:
Journal Entries
in the booms of Kaloo.
|
Date
|
Particulars
|
LF
|
Debit
(Rs)
|
Credit
(Rs)
|
|
1.
|
Bills Receivable A/c …Dr.
|
|
8000
|
|
|
|
To Baloo's A/c
|
|
|
8000
|
|
|
[Being the Bill is drawn]
|
|
|
|
|
2.
|
Bank A/c …Dr.
|
|
7760
|
|
|
|
Discount A/c … Dr.
|
|
240
|
|
|
|
To Bills Receivable A/c
|
|
|
8000
|
|
|
[Being the Bill is discounted with the bank]
|
|
|
|
|
3.
|
Baloo's A/c … Dr.
|
|
8030
|
|
|
|
To Bank's A/c
|
|
|
8030
|
|
|
[Being the discounted bill is dishonoured along with noting charges]
|
|
|
|
|
4.
|
Baloo's A/c … Dr.
|
|
170
|
|
|
|
To Interest A/c
|
|
|
170
|
|
|
[Being Interest is charged on balance amount]
|
|
|
|
|
5.
|
Bills Receivable A/c …Dr.
|
|
8200
|
|
|
|
To Baloo's A/c
|
|
|
8200
|
|
|
[Being the New bill is drawn for balance amount along with interest and
noting charges]
|
|
|
|
|
6.
|
Cash / Bank A/c … Dr.
|
|
8160
|
|
|
|
Rebate's A/c … Dr.
|
|
40
|
|
|
|
To Bills Receivable A/c
|
|
|
8200
|
|
|
[Being the second bill is retired]
|
|
|
|