OMTEX CLASSES: Archana purchased goods from Babita on credit for Rs. 20,000. On next day Archana paid Rs. 10,000 to Babita and accepted a bill drawn by Babita for the balance amount for four months. Babita discounted the bill with her bank for Rs. 9600/-. Before the due date Archana approached Babita with a request to renew the Bill. Babita agreed with the condition that Archana should pay Rs. 6000 along with interest of Rs. 120 and accept a new bill for the balance. These arrangements were duly carried out. New bill is met on the due date. Pass journal entries in the books of Archana.

Sunday, August 25, 2013

Archana purchased goods from Babita on credit for Rs. 20,000. On next day Archana paid Rs. 10,000 to Babita and accepted a bill drawn by Babita for the balance amount for four months. Babita discounted the bill with her bank for Rs. 9600/-. Before the due date Archana approached Babita with a request to renew the Bill. Babita agreed with the condition that Archana should pay Rs. 6000 along with interest of Rs. 120 and accept a new bill for the balance. These arrangements were duly carried out. New bill is met on the due date. Pass journal entries in the books of Archana.