OMTEX AD 2

HSC Board Book Keeping & Accountancy Bill of Exchange Solved Problem & Previous Papers. Apate draws a bill on Mapate for Rs. 8000 at 3 months.

Bill of Exchange Problem Solution - Apate and Mapate

Question

Apate draws a bill on Mapate for Rs. 8000 at 3 months. Mapate accepted the same and sent to Apate. Apate sent the same bill to his bank for collection. On due date Mapate found himself unable to make payment of the bill, and requested Apate to renew it.

Apate agreed on the condition that Mapate should pay Rs. 2000 and interest Rs. 200 on the remaining balance in cash and accept a fresh bill for the balance for two months.

These agreements were carried through. On due date of new bill it was duly honoured.

Pass journal entries and Mapate’s account in the books of Apate.

Solution: Journal Entries

In the Books of Apate [Drawer]

Date Particulars L.F. Debit (Rs.) Credit (Rs.)
1. Bills Receivable A/c ....Dr. 8000
To Mapate A/c 8000
[Being the bill is drawn]
2. Sent to Bank for Collection A/c .... Dr. 8000
To Bills Receivable A/c 8000
[Being the bill is sent to bank for collection]
3. Mapate A/c .... Dr. 8000
To Sent to Bank for Collection A/c 8000
[Being the bill is dishonoured]
4. Mapate A/c ..... Dr. 200
To Interest A/c 200
[Being the interest is charged on balance amount]
5. Cash A/c ..... Dr. 2200
To Mapate A/c 2200
[Being the part payment is made along with interest]
6. Bills Receivable A/c ..... Dr. 6000
To Mapate A/c 6000
[Being the new bill is drawn]
7. Cash A/c .... Dr. 6000
To Bills Receivable A/c 6000
[Being the new bill is duly honoured]

Solution: Ledger Account

In the books of Apate

Mapate’s Account

Dr. Cr.
Date Particulars Amount (Rs.) Date Particulars Amount (Rs.)
? To balance b/d 8000 1. By Bills Receivable A/c 8000
3. To Bank for Collections A/c 8000 5. By Cash A/c 2200
4. To Interest A/c 200 6. By Bills Receivable A/c 6000
16200 16200

Board Question Papers & Solutions

Labels: , , , , ,