OMTEX AD 2

Journalise the following transactions int he books of Kedarnath:

Bills of Exchange: Journal Entries and HSC Board Papers

Journal Entries: Bills of Exchange

Problem Statement

1. Badrinath informs Kedarnath that Aloknath's Acceptance of Rs. 16,000 endorsed to Badrinath has been dishonoured and noting charges amounted to Rs. 500.
2. Somnath renews his acceptance of Rs. 14,400 to Kedarnath by paying cash Rs. 4,400 and accepting a new bill for 2 months for the balance plus interest @ 12% p.a.
3. Vishwanath retired his acceptance for Rs. 10,500 to Kedarnath by paying in cash Rs. 10,250
4. Recovered only 50% of the amount due from his private estate of Ramnath, who declared as insolvent, against his bill of Rs. 12,500. [10 MARKS]

Journal Entries (Solution)

Date Particulars L.F. Debit (₹) Credit (₹)
A. Aloknath's A/c ……………Dr. 16500
To Badrinath's A/c 16500
[Being the endorsed bill is dishonoured along with noting charges.]
B. (i) Somnath's A/c ……… Dr. 14400
To Bills Receivable A/c 14400
[Being the bill is dishonoured]
(ii) Cash a/c ………… Dr. 4400
To Somnath's A/c 4400
[Being the Part Payment is Made]
(iii) Somnath's A/c ………… Dr. 200
To Interest A/c 200
[Being the Interest is charged on balance amount]
(iv) Bills Receivable A/c ………… Dr. 10200
To Somnath's A/c 10200
[Being the new bill is drawn along with interest]
(C) Cash A/c ……………… Dr. 10,250
Rebate's A/c ………… Dr. 250
To Bills Receivable's A/c 10,500
[Being the Bill is retired]
(D) (i) Ramnath's A/c ……………………… Dr. 12500
To Bills Receivable A/c 12500
[Being the Bill is dishonoured]
(ii) Cash/ Bank A/c …………Dr. 6250
Bad Debts A/c …………… Dr. 6250
To Ramnath's A/c 12500
[Being the Drawee Ramnath become insolvent and only 50% of the amount could be recovered from his private estate]

HSC Board Question Papers & Solutions

Labels: