Date

Particulars

LF

Debit
(Rs)

Credit
(Rs)

? 1.

Archana's A/c … Dr.


20000



To Sales A/c



20000


[Being the goods are sold]




2.

Cash/Bank A/c … Dr.


10000



To Archana's A/c



10000


[Being the part payment is made]




3.

Bills Receivable A/c …Dr.


10000



To Archana's A/c



10000


[Being the Bill is drawn]




3.

Bank A/c …Dr.


9600



Discount A/c … Dr.


400



To Bills Receivable A/c



10000


[Being the Bill is discounted with the bank]




4.

Archana's A/c … Dr.


10000



To Bank's A/c



10000


[Being the discounted bill is dishonoured]




5.

Archana's A/c … Dr.


120



To Interest A/c



120


[Being Interest is charged on balance amount]




6.

Cash / Bank A/c … Dr.


6120



To Archana's A/c



6120


[Being the part payment is made along with interest]




7.

Bills Receivable A/c …Dr.


4000



To Archana's A/c



4000


[Being the New bill is drawn for balance amount]




8.

Cash/Bank A/c …… Dr.


4000



To Bills Receivable A/c



4000


[Being the second bill is duly honoured]




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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 Babita.
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 Babita.
Solution:
Journal Entries
in the booms of Babita.