On 17th June, 2012
rohit discounted the bill with his bank @ 10% p.a.
On due date Devidas finds himself
unable to make payment of the bill and requests Rphit to renew it.
Rohit accepted the proposal on
the condition that Devidas should pay Rs. 10,000 on account along with interest
Rs. 500 in cash and should accept a new bill for the balance at 2 months.
These arrangements were carried
though.
Give Journal Entries in the Books
of Rohit.
Solution:
Journal Entries in the Books of
Rohit.
|
Date
|
Particulars
|
L.F.
No.
|
Debit
|
Credit
|
|
14.5.12
|
Devidas’s A/c ……… Dr.
|
|
30000
|
|
|
|
To Sales A/c
|
|
|
30000
|
|
|
[Being goods sold on credit]
|
|
|
|
|
14.5.12
|
Bills Receivable A/c ……… Dr.
|
|
30000
|
|
|
|
To Devidas’s A/c
|
|
|
30000
|
|
|
[Being the Bill is drawn]
|
|
|
|
|
17.6.12
|
Bank A/c ……… Dr.
|
|
29250
|
|
|
|
Discount A/c ……… Dr.
|
|
750
|
|
|
|
To Bills Receivable A/c
|
|
|
30000
|
|
|
[Being the bill is discounted]
|
|
|
|
|
17.9.12
|
Devidas’s A/c ……… Dr.
|
|
30000
|
|
|
|
To Bank A/c
|
|
|
30000
|
|
|
[Being the discounted bill is
dishonoured]
|
|
|
|
|
17.9.12
|
Devidas’s A/c ……… Dr.
|
|
500
|
|
|
|
To Interest A.c
|
|
|
500
|
|
|
[Being the Interest is charged
on balance amount]
|
|
|
|
|
17.9.12
|
Cash A/c ……… Dr.
|
|
10500
|
|
|
|
To Devidas’s A/c
|
|
|
10500
|
|
|
[Being Part payment along with
interest received ]
|
|
|
|
|
17.9.13
|
Bills Receivable A/c ………Dr.
|
|
20000
|
|
|
|
To Devidas’s A/c
|
|
|
20000
|
|
|
[Being the new bill is drawn
for the balance amount]
|
|
|
|
Working Notes:
(1) Discount charged by the bank
= Amount of Bill × Period × Rate of Discount
∴ Discount Charged by the Bank =
30000 × (3/12) × (10/100) = Rs. 750
[Note: Period of the bill is for
4 months but it is discounted one month after, therefore the period of the bill
is to be considered for 3 months only.]
(2) Amount of New Bill = Amount
of Dishonoured bill + Interest on balance Amount – Part Payment.
∴ Amount of New Bill = 30000 + 500
– 10500 = Rs. 20,000.
