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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

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BILL OF EXCHANGE

31. Krishna accepted a bill for three months drawn by Rama for Rs. 4000. Rama discounted the bill with the bank at Rs. 3900. On the date of maturity, the bill was dishonoured. Rama paid noting charges for Rs. 20. Krishna paid half the amount for the bill and full amount of the noting charges and accepted a bill for the balance including interest of Rs. 50. The second bill was duly honoured. Pass necessary journal entries in the books of Rama and show Krishna’s account.  [Ans.]
32. Sagar owes Sindhu Rs. 8000 Sagar accepted a bill for 3 months by Sindhu for Rs. 8000. Sindhu discounted the bill with bank at Rs. 7800. On the due date, the bill was dishonoured. Noting charges amounted to Rs. 20. Sagar Paid half the amount of the bill and full amount of the noting charges including interest of Rs. 100. Pass journal entries in the books of Sindhu and show the account of Sagar.

33. Jain purchased goods worth Rs. 3,000 from Sharma on 1st June 1977 and gave him acceptance on 3rd June for a period of three months. On 15th June Sharma discounted the bill for Rs. 2980. On 6th September, when the bill was presented for payment. Jain dishonoured the same. Rs. 20 was paid as noting charges. Pass journal entries in the books of Sharma and Sharma’s account in the books of Jain.


34. Ameet draws a bill for Rs. 7500 on Tushar for four months. Ameet discounts the bill with the bank at 8%p.a. On the due date Tushar requested Ameet to accept Rs. 4,700 (including Rs. 200 for interest) and to draw a bill for the balance of three months. Ameet agrees this proposal. Before the due date of the new bill Tushar retires the bill for Rs. 2960. Pass the journal entries in the books of Tushar and open Tushar’s account in the books of Ameet.Journal Entries in the Books of Tushar.
35. Journalise the following transactions in the books of Rahul.

* Pradeep informed Rahul that, Vijay’s acceptance for Rs. 1,000 endorsed to Pradeep has been dishonoured. Noting charges amounted to Rs. 50.

* Nilesh renews his acceptance to Rahul for Rs. 600 by paying Rs. 200 in cash and accepting a fresh bill for balance plus interest at 12% p.a. for 3 months.

* Prashant’s acceptance to Rahul for Rs. 3,000 retired one month before due date at a discount of 12% p.a.

* Bank informs Rahul as to the dishonour of Aviraj’s acceptance for Rs. 1,000 to Rahul, discounted with the bank. Noting charges are Rs. 20. [Ans] 

36. Journalise the following transactions in the books of Mr. Ashok Agrawal.

The bank informed Mr. Ashok Agrawal that Kamlesh’s acceptance for Rs. 12,000 sent to bank for collection had been honoured and bank charges debited were Rs. 60.

Discharged Dr. Ashok Agrawal’s acceptance to Mahesh for Rs. 15,250 by endorsing Prakash’s acceptance to Mr. Ashok Agrawal for Rs. 15,100.

Vishal renewed his acceptance to Mr. Ashok Agrawal for Rs. 11,200 by paying Rs. 6000 in cash and accepting a fresh bill for the balance plus interest @ 12% p.a. for three months.

Dinesh who had accepted Mr. Ashok Agrawal’s bill of Rs. 14,000 was declared bankrupt and only 45% of the amount due could be recovered from his estate. [Ans]


37. Journalise the following transactions in the books of Kamalakar.

Nisha informs Kamalakar that Shanti’s acceptance for Rs. 14,000 endorsed to Nisha has been dishonoured and noting charges have been paid Rs. 200.

Asha renews hare acceptance to Kamalakar for Rs. 12400 by paying Rs. 6000 in cash and accepting a new bill for the balance plus interest @ 12% p.a. for 3 months.

The bank informs Kamalakar that Sindhu’s acceptance for Rs. 15000 has been dishonoured and it has paid noting charges Rs. 100.

Bank informs Kamalakar that Sangita’s acceptance for Rs. 12000 which was sent to bank for collection has been dishonoured. [Ans]


38. Journalise the following transactions in the books of Ranbir.
Sonam informs Ranbir that Salman’s acceptance for Rs. 3200 endorsed to Sonam has been dishonoured and the noting charges amounted to Rs. 80.

Ravindra renews his acceptance to Ranbir for Rs. 4,800 by paying Rs. 1800 in cash and accepted a fresh bill for the balance, plus interest @ 12% p.a for 2 months.

Dilip’s acceptance to Ranbir for Rs 8000 is retired one month before the due date at a discount of 12% p.a.

The bank informs Ranbir that Shirin’s acceptance for Rs 5500 to Ranbir discounted with the bank earlier has been dishounred and the noting charges Rs. 100. [Ans]


39. Journalise the following transactions int he books of Kedarnath:

 Badrinath informs Kedarnath that Aloknath's Acceptance of Rs. 16,000 endorsed to Badrinath has been dishonoured and noting charges amounted to Rs. 500.

Somnath renews his acceptance of Rs. 14,400 to Kedarnath by paying cash Rs. 4,400 and accepting a new bill for 2 months for the balance plus interest @ 12% p.a.

Vishwanath retired his acceptance for Rs. 10,500 to Kedarnath by paying in cash Rs. 10,250.


Recovered only 50% of the amount due from his private estate of Ramnath, who declared as insolvent, against his bill of Rs. 12,500.  [Ans]




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BILL OF EXCHANGE WITH SOLUTION

Format of the Bill of Exchange


Problem No. 21.

Salman draws a bill on Amithab worth Rs. 90,000 for three months which was accepted by Amithab. On the same date Salman discounted the bill with his bank @ 10 % p.a. On the due date Amithab dishonoured his acceptance. Amithab paid Rs. 40,000/- to Salman and accepted a fresh bill for two months for the balance including interest of Rs. 4000. Amithab became insolvent before the maturity of the bill and 50 paise in a rupee was received at first and final dividend from his estate. Journal entries books of Amithab. [ANS]

Problem No. 22.

On 1st January, 2014 Archana drew a bill for Rs. 6,000 for 2 months periods on Ramya. Ramya duly accepted the bill. On 4th January 2014 Archana discounted the bill with her bank for Rs. 5850. However, on the due date the bill was dishonoured. Ramya agreed to accept a new bill with an interest of Rs. 150 for a period of one month. The bill was duly met on the due date. Give the journal entries in the books of Archana and show Archana’s account in the books of Ramya. [ANS]

Problem No. 23.

Mukesh owes Anil Rs. 40000 for which Anil draws a bill for 2 months on 1st February, 2014. Mukesh accepts it and returns it to Anil. On 4th March, 2014, Mukesh approaches Anil and request him to accept Rs. 10000 in cash and draw a fresh bill for 3 months for the balance plus interest @ 10% p.a. Anil accepts the request and draw a bill accordingly which is accepted by Mukesh. On 1st June 2014 Mukesh retired his acceptance under discount of Rs. 30/-. Pass journal entries in the books of Anil and prepare Anil account in the ledger of Mukesh. [ANS]


Problem No. 24.

Anjali of Nagpur sold goods worth Rs. 25,000 to Rupali of Amaravati. On next day Ruapali paid Rs. 10,000 in cash and accepted two months bill for the balance drawn by Anjali. Anjali discounted the bill at 12% p.a. with her bank. Before due date, Rupali finds herself unable to make payment of the bill; and requests Anjali to renew it. Anjali accepts the proposal on the condition that Rupali should pay Rs. 5,000 in cash and accept new bill for one month along with interest Rs. 200 for the balance. These arrangements were carried through. The new bill was met on due date. Give journal entries in the books of Anjali. [ANS]


Problem No. 25.
Prakash drew a bill for Rs. 4,000 on Anand on 1st May, 2013 for three months. This was for the amount which Anand owed to Prakash. Anand accepts the same and return it to Prakash who discounted at his bank for Rs. 3,900. On 1st Aug, 2013 Anand requested Prakash to renew the bill and Prakash agreed on the condition that Rs. 1,000 is paid immediately and Anand should accept the new bill for 3 months for the balance payable plus interest of Rs. 45. These arrangements were carried through. However, on 1st October, 2013, Anand retired his acceptance for Rs. 3, 035. Pass journal entries in the books of Anand. [Ans]



Problem No. 26. 

Chanda accepted a bill for Rs. 6,000 drawn by Nanda at three months. Nanda got the bill discounted with his bank for Rs. 5,700. Before the due date, Chanda approached Nanda for renewal of the Bill. Nanda agreed on the condition that Rs. 3,000 is paid immediately together with an interest on remaining amount at 18% p.a. for four months and for the balance Chanda should accept a new bill. But afterwards Chanda become insolvent and only 25% of the amount could be recovered from her estate. Pass journal entries in the books of Chanda. [Ans.]  



Problem No. 27. 
Pankaj draws a bill on Anil worth Rs. 8,000 for three months which was accepted by Anil. On the same date Pankaj discounted the bill with his bank @ 10 % p.a. On the due date Anil dishonoured his acceptance. Anil paid Rs. 4,000/- to Pankaj and accepted a fresh bill for two months for the balance including interest of Rs. 40. Anil became insolvent before the maturity of the bill and 50 paise in a rupee was received at first and final dividend from his estate. Give Journal entries in the books of Anil. [Ans.] 


Problem No. 28. 
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. [Ans. ]



Problem No. 29. 

Mukund owes (be obligated) Prakash Rs. 4000 for which Prakash draws a bill for 2 months on 1st February, 1989. Mukund accepts it and returns it to Prakash. On 4th March, 1989, Mukund approaches Prakash and request him to accept Rs. 1000 in cash and draw a fresh bill for 3 months for the balance plus interest @ 10% p.a. Prakash accepts the request and draw a bill accordingly which is accepted by Mukund. On 1st June 1989 Mukund retired his acceptance under discount of Rs. 30/-. Pass journal entries in the books of Prakash and prepare Prakash account in the ledger of Mukund. [Ans.] 



Problem No. 30

Journalise the following transactions int he books of Kedarnath:

1. Badrinath informs Kedarnath that Aloknath's Acceptance of Rs. 16,000 endorsed to Badrinath has been dishonoured and noting charges amounted to Rs. 500.

2. Somnath renews his acceptance of Rs. 14,400 to Kedarnath by paying cash Rs. 4,400 and accepting a new bill for 2 months for the balance plus interest @ 12% p.a.

3. Vishwanath retired his acceptance for Rs. 10,500 to Kedarnath by paying in cash Rs. 10,250.

4. Recovered only 50% of the amount due from his private estate of Ramnath, who declared as insolvent, against his bill of Rs. 12,500.  [10 MARKS]    [ANS]
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Format of the Bill of Exchange

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BILL OF EXCHANGE WITH SOLUTION

Format of the Bill of Exchange


 Problem No. 11

On 1st March, 2014. Bheem sold goods to Raju worth Rs. 10,000/- and Raju accepted the Bill for Rs. 10,000/- at 3 months drawn by Bheem. Bheem discounted the bill with his bank @ 10% p.a. On due date the bill was dishonoured and Raju requested Bheem to accept Rs. 4,000/- immediately and draw upon him a new bill for the remaining amount at 3 months together with an interest @ 10% p.a. Bheem agreed. The second Bill was duly honoured. Give Journal entries in the books of Bheem. [Ans]
Problem No. 12

Sachin sold goods to Dhoni worth Rs. 1,00,000/- and Dhoni accepted the bill for Rs. 1,00,000/- at 3 months drawn by Sachin. Sachin discounted the bill with his bank @ 10 % p.a. On due date the bill was dishonoured and Dhoni requested Sachin to accept Rs. 40,000 immediately and draw upon him a new bill for the remaining amount at 3months together with an interest at 10% p.a. Sachin agreed and the second bill was duly honoured. Give the Journal entries in the books of Dhoni.  [Ans]

Problem No. 13

Rose purchased goods from Lilly on credit for Rs. 2,000. On next day Rose paid Rs. 1,000 to Lilly and accepted a bill drawn by Lilly for the balance amount for four months. Lilly discounted the bill with her bank for Rs. 960/-. Before the due date Rose approached Lilly with a request to renew the Bill. Lilly agreed with the condition that Rose should pay Rs. 600 along with interest of Rs. 12 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 books of Lilly. [Ans]


Problem No. 14

Kaveri sold goods to Ganga worth Rs. 4,000 to Ganga. On the next day Ganga paid Rs. 1,000 in cash and accepted 4 months bill for balance amount drawn by Kaveri.  Kaveri discounted the bill at 10% p.a. after one month with her bank. On due date Ganga dishonoured her acceptance and noting charges amounted to Rs. 20. Ganga paid half the amount of the bill and full amount of noting charges. Ganga accepted a new bill at 2 months for the balance amount plus interest Rs. 100. Pass necessary journal entries in the books of Kaveri. [Ans]

Problem No. 15

Ronaldo owes Ricardo Rs.80,000. Ricardo then draws a bill for Rs. 80,000 on Ronaldo for a period of three months. Ronaldo accepts and return it to Ricardo. Ricardo discounted the bill with his bank @ 10 % p.a. On due date, the bill was dishonoured noting charges amount to Rs. 300. Ricardo then draws a bill for the balance plus interest of Rs. 1700. Before the due date of this bill Ronaldo pays the amount at a discount of Rs. 400 to retire the bill. Journal Entries Ronaldo. [Ans]


Problem No. 16

Sun draws a bill on Moon for Rs. 15,000 at 3 months. Moon accepts the bill and return to Sun. Sun discounted the bill @ 10 % p.a. with the bank. On Maturity Moon finds herself unable to make payment of the bill and requested Sun to renew the bill. Sun accepts the proposal on the condition that Moon should Pay Rs. 12,000 in cash and accept a new bill at one month along with interest at 10% p.a. These arrangements were carried through. Moon retires the bill by paying Rs. 3015/- Pass Journal Entries in the books of Sun. [Ans]


Problem No. 17. 

Nazriya draws a bill on Anitha for Rs. 60,000 at 4 months. Anitha accepts the bill and returns it to Nazriya who discounts the bill with the bank at a discount of 10% p.a. Before the due date of Bill Anitha requested Nazriya to accept Rs. 40000 in cash and draw a bill for the balance plus interest at 12% p.a. for two months. Nazriya draws a bill as the request is agreed. The bill is sent to bank for collection. On the due date the bill was honoured. Pass the necessary journal entries in the books of Anitha. [Ans.]

Problem No. 18.

8. Anil drew a bill for Rs. 4,000 on Navin on 1st May, 2013 for three months. This was for the amount which Navin owed to Anil. Navin accepts the same and return it to Anil who discounted at his bank for Rs. 3,900. On 1st Aug, 2013 Navin requested Anil to renew the bill and Anil agreed on the condition that Rs. 1,000 is paid immediately and Navin should accept the new bill for 3 months for the balance payable plus interest of Rs. 45. These arrangements were carried through. However, on 1st October, 2013, Navin retired his acceptance for Rs. 3, 035. Pass journal entries in the books of Anil. [Ans]

Problem No. 19.

9. Karthik accepted a bill for Rs. 20,000/- drawn by Jones at three months. Jones got the bill discounted with his bank for Rs. 19,900. Before the due date Karthik approached Jones for renewal of the bill. Jones agreed on the condition that Rs. 10,000/- be paid immediately together with interest on the remaining amount at 6% p.a. For balance Karthik should accept a new bill for three months. These arrangements were carried through but afterwards, Karthik become Insolvent and only 80 % of the amount could be recovered from his estate. Give journal entries in the books of Karthik. [Ans]

Problem No. 20.

10. Ajith accepted a bill for Rs. 10,000 drawn by Surya at three months. Surya got the bill discounted with his bank for Rs. 9,700. Before the due date, Ajith approached Surya for renewal of the Bill. Surya agreed on the condition that Rs. 7,000 is paid immediately together with an interest on remaining amount at 18% p.a. for four months and for the balance Ajith should accept a new bill. But afterwards Ajith become insolvent and only 25% of the amount could be recovered from her estate. Pass journal entries in the books of Surya.  [Ans]

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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
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