On 1st January, 1988 Vandana drew a bill for Rs. 6,000 for 2 months periods on Lata. Lata duly accepted the bill. On 4th January 1988 Vandana discounted the bill with her bank for Rs. 5850. However, on the due date the bill was dishonoured. Lata agreed to accept a new bill with an interest of Rs. 100 for a period of one month. The bill was duly met on the due date. Give the journal entries in the books of Vandana and show Vandana’s account in the books of Lata.
Journal
Entries In the Books of Vandana
|
Date
|
Particulars
|
LF
|
Debit
(Rs)
|
Credit
(Rs)
|
|
1.1.88
|
Bills Receivable A/c ....Dr.
|
|
6000
|
|
|
|
To Lata's A/c
|
|
|
6000
|
|
|
[Being the bill is drawn]
|
|
|
|
|
4.1.88
|
Bank A/c ....Dr.
|
|
5850
|
|
|
|
Discount A/c ....Dr.
|
|
150
|
|
|
|
To Bills Receivable A/c
|
|
|
6000
|
|
|
[Being the bill is discounted]
|
|
|
|
|
4.3.88
|
Lata's A/c ....Dr.
|
|
6000
|
|
|
|
To Bank A/c
|
|
|
6000
|
|
|
[Being the Discounted bill is dishonoured]
|
|
|
|
|
4.3.88
|
Lata's A/c ....Dr.
|
|
100
|
|
|
|
To Interest A/c
|
|
|
100
|
|
|
[Being the Interest is Charged]
|
|
|
|
|
4.3.88
|
Bills Receivable A/c ....Dr.
|
|
6100
|
|
|
|
To Lata's A/c
|
|
|
6400
|
|
|
[Being the new bill is drawn along with interest]
|
|
|
|
|
7.4.88
|
Bank A/c ....Dr.
|
|
6100
|
|
|
|
To Bills Receivable A/c
|
|
|
6100
|
|
|
[Being the new bill is duly honoured]
|
|
|
|
In the Books of Lata
Vandana's A/c
|
Date
|
Particulars
|
J
F
|
Amount
|
Date
|
Particulars
|
J
F
|
Amount
|
|
1.1.88
|
To Bills Payable A/c
|
|
6000
|
1.1.88
|
By Balance b/d
|
|
6000
|
|
4.3.88
|
To Bills Payable A/c
|
|
6100
|
4.3.88
|
By Bills Payable A/c
|
|
6000
|
|
|
|
|
|
4.3.88
|
By Interest A/c
|
|
|
|
|
|
|
12100
|
|
|
|
12100
|