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THIS PDF FOR DEGREE 2ND SEMESTER ACCOUNTS 10

MARKS PROBLEM ➔ BILLS OF EXCHANGE

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 BILLS OF EXCHANGE
TOPICS: -
1. JOURNAL ENTRIES
2. GENERAL BILL
→ HONOURED
→ DISHONOURED
3. DISCOUNTED BILL
→ HONOURED
→ DISHONOURED
4. ENDORSED BILL
→ HONOURED
→ DISHONOURED
5. BILL SENT TO BANK FOR COLLECTION
→ HONOURED
→ DISHONOURED
6. 4 TOPICS HONOURED PROBLEM
7. 4 TOPICS DISHONOURED PROBLEM
8. 4 TOPICS NOTING CHARGES PROBLEM
9. RENEWAL OF A BILL THREE PROBLEMS
 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ GENERAL BILL
1. ON 1/1/15 ‘X’ SOLD 3,000 VALUE OF GOODS TO ‘Y’ ON CREDIT. FOR THAT ‘X’
WROTE A 3 MONTHS BILL ON ‘Y’ AND ACCEPTED BY HIM AND ON DEW DATE BILL
WAS HONOURED?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (X)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/1/15 ‘Y’ A/C DR 3,000
TO SALES A/C 3,000
(BEING SOLD GOODS TO ‘Y’)
1/1/15 BILLS RECEIVABLE A/C DR 3,000
TO ‘Y’ A/C 3,000
(BEING THE BILL DRAWN)
4/4/15 BANK A/C DR 3,000
TO BILLS RECEIVABLE A/C 3,000
(BEING ON DEW DATE BILL WAS HONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (Y)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/1/15 PURCHASES A/C DR 3,000
TO ‘X’ A/C 3,000
(BEING GOODS PURCHASED FROM ‘X’)
1/1/15 ‘X’ A/C DR 3,000
TO BILLS PAYABLE A/C 3,000
(BEING THE BILL WAS ACCEPTED)
4/4/15 BILLS PAYABLE A/C DR 3,000
TO BANK A/C 3,000
(BEING BILL AMOUNT PAID ON MATURITY)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ GENERAL BILL
2. ON 1/1/15 ‘X’ SOLD 15,000 VALUE OF GOODS TO ‘Y’ ON CREDIT. FOR THAT ‘X’
WROTE A 3 MONTHS BILL ON ‘Y’ AND ACCEPTED BY HIM AND ON DEW DATE BILL
WAS DISHONOURED?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (X)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/1/15 ‘Y’ A/C DR 15,000
TO SALES A/C 15,000
(BEING SOLD GOODS TO ‘Y’)
1/1/15 BILLS RECEIVABLE A/C DR 15,000
TO ‘Y’ A/C 15,000
(BEING THE BILL DRAWN)
4/4/15 ‘Y’ A/C DR 15,000
TO BILLS RECEIVABLE A/C 15,000
(BEING ON DEW DATE BILL WAS DISHONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (Y)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/1/15 PURCHASES A/C DR 15,000
TO ‘X’ A/C 15,000
(BEING GOODS PURCHASED FROM ‘X’)
1/1/15 ‘X’ A/C DR 15,000
TO BILLS PAYABLE A/C 15,000
(BEING THE BILL WAS ACCEPTED)
4/4/15 BILLS PAYABLE A/C DR 15,000
TO ‘X’ A/C 15,000
(BEING BILL WAS DISHONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ DISCOUNTED BILL
3. ON 1/7/14 PAVAN SOLD 14,000 RS GOODS TO NAGARAJU FOR THAT HE WROTE
BILL ON HIM. PAVAN THIS BILL WAS DISCOUNTED AT BANK 13,800. ON DEW DATE
NAGARAJU PAID THE BILL?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (PAVAN)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/7/14 NAGARAJU A/C DR 14,000
TO SALES A/C 14,000
(BEING SOLD GOODS TO NAGARAJU)
1/7/14 BILLS RECEIVABLE A/C DR 14,000
TO NAGARAJU A/C 14,000
(BEING THE BILL DRAWN)
1/7/14 BANK A/C DR 13,800
DISCOUNT A/C DR 200
TO BILLS RECEIVABLE A/C 14,000
(BEING THE BILL DISCOUNTED WITH A BANK)
4/10/14 NO ENTRY - -
(BEING BILL WAS HONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (NAGARAJU)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/7/14 PURCHASES A/C DR 14,000
TO PAVAN A/C 14,000
(BEING GOODS PURCHASED FROM PAVAN)
1/7/14 PAVAN A/C DR 14,000
TO BILLS PAYABLE A/C 14,000
(BEING THE BILL WAS ACCEPTED)
4/10/14 BILLS PAYABLE A/C DR 14,000
TO BANK A/C 14,000
(BEING BILL WAS HONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ DISCOUNTED BILL
4. ON 1/8/14 CHARAN SOLD GOODS 5,400 RS TO SUMANTH ON CREDIT. FOR THAT
HE WROTE 4 MONTHS BILL ON HIM ACCEPTED IT. CHARAN THIS BILL WAS
DISCOUNTED AT 10% ON DEW DATE BILL WAS DISHONOURED?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (CHARAN)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/8/14 SUMANTH A/C DR 5,400
TO SALES A/C 5,400
(BEING SOLD GOODS TO SUMANTH)
1/8/14 BILLS RECEIVABLE A/C DR 5,400
TO SUMANTH A/C 5,400
(BEING THE BILL DRAWN)
1/8/14 BANK A/C DR 4,860
DISCOUNT A/C DR 540
TO BILLS RECEIVABLE A/C 5,400
(BEING THE BILL DISCOUNTED WITH A BANK)
4/12/14 SUMANTH A/C DR 5,400
TO BANK A/C 5,400
(BEING BILL WAS DISHONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (SUMANTH)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/8/14 PURCHASES A/C DR 5,400
TO CHARAN A/C 5,400
(BEING GOODS PURCHASED FROM CHARAN)
1/8/14 CHARAN A/C DR 5,400
TO BILLS PAYABLE A/C 5,400
(BEING THE BILL WAS ACCEPTED)
4/12/14 BILLS PAYABLE A/C DR 5,400
TO CHARAN A/C 5,400
(BEING BILL WAS DISHONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ ENDORSE BILL
5. ON 1/5/15 SUSHMA SOLD 5,000 RS GOODS TO KAMALA ON CREDIT FOR THAT
SHE WROTE TWO MONTHS BILL ON KAMALA ACCEPTED BY HER. SUSHMA THIS
5,000 RS BILL ENDORESED HER CREDITOR PARVATHI. ON DEW DATA THE BILL WAS
HONOURED?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (SUSHMA)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/5/15 KAMALA A/C DR 5,000
TO SALES A/C 5,000
(BEING SOLD GOODS TO KAMALA)
1/5/15 BILLS RECEIVABLE A/C DR 5,000
TO KAMALA A/C 5,000
(BEING THE BILL DRAWN)
4/7/15 PARVATHI A/C DR 5,000
TO BILLS RECEIVABLE A/C 5,000
(BEING THE BILL ENDORSED TO A CREDITOR)
4/7/15 NO ENTRY - -
(BEING THE BILL WAS HONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (KAMALA)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/5/15 PURCHASES A/C DR 5,000
TO SUSHMA A/C 5,000
(BEING GOODS PURCHASED FROM SUSHMA)
1/5/15 SUSHMA A/C DR 5,000
TO BILLS PAYABLE A/C 5,000
(BEING THE BILL WAS ACCEPTED)
4/7/15 BILLS PAYABLE A/C DR 5,000
TO BANK A/C 5,000
(BEING BILL WAS HONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ ENDORSE BILL
6. ON 1/9/17 NAGUR SOLD 3,000 RS GOODS TO HARISH FOR THAT HARISH
ACCEPTED TWO MONTHS BILL. ON 1/10/17 THIS BILL WAS ENDORSED TO HIS
CREDITOR ISMAIL ON DEW DATE BILL WAS DISHONOURED?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (NAGUR)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/9/17 HARISH A/C DR 3,000
TO SALES A/C 3,000
(BEING SOLD GOODS TO HARISH)
1/9/17 BILLS RECEIVABLE A/C DR 3,000
TO HARISH A/C 3,000
(BEING THE BILL DRAWN)
1/10/17 ISMAIL A/C DR 3,000
TO BILLS RECEIVABLE A/C 3,000
(BEING THE BILL ENDORSED TO A CREDITOR)
4/11/17 HARISH A/C DR 3,000
TO ISMAIL A/C 3,000
(BEING THE ENDORSED BILL WAS DISHONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (HARISH)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/9/17 PURCHASES A/C DR 3,000
TO NAGUR A/C 3,000
(BEING GOODS PURCHASED FROM NAGUR)
1/9/17 NAGUR A/C DR 3,000
TO BILLS PAYABLE A/C 3,000
(BEING THE BILL WAS ACCEPTED)
4/11/17 BILLS PAYABLE A/C DR 3,000
TO NAGUR A/C 3,000
(BEING BILL WAS DISHONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ BILL WAS SENT FOR COLLECTION
7. ON 6/8/14 MAHESH 3,500 RS OF GOODS SOLD TO RAJESH ON CREDIT ON THE
SAME AMOUNT HE WROTE A TWO MONTHS BILL ON RAJESH AND ACCEPTED BY
HIM. MAHESH THIS BILL WAS SENT FOR COLLECTION. ON DEW DATE THIS BILL WAS
HONOURED?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (MAHESH)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
6/8/14 RAJESH A/C DR 3,500
TO SALES A/C 3,500
(BEING SOLD GOODS TO RAJESH)
6/8/14 BILLS RECEIVABLE A/C DR 3,500
TO RAJESH A/C 3,500
(BEING THE BILL DRAWN)
6/8/14 B.S.F.C A/C DR 3,500
TO BILLS RECEIVABLE A/C 3,500
(BEING THE BILL SENT FOR COLLECTION)
9/10/14 BANK A/C DR 3,500
TO B.S.F.C A/C 3,500
(BEING THE BILL WAS HONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (RAJESH)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/9/17 PURCHASES A/C DR 3,500
TO MAHESH A/C 3,500
(BEING GOODS PURCHASED FROM MAHESH)
1/9/17 MAHESH A/C DR 3,500
TO BILLS PAYABLE A/C 3,500
(BEING THE BILL WAS ACCEPTED)
4/11/17 BILLS PAYABLE A/C DR 3,500
TO BANK A/C 3,500
(BEING BILL WAS HONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ BILL WAS SENT FOR COLLECTION
8. ON 4/6/14 GOVIND SOLD 4,500 RS OF GOODS TO ANAND ON CREDIT FOR THAT
HE WROTE 4 MONTHS BILL ON ANAND ACCEPTED BY HIM. ON 1/10/14 GOVIND
THIS BILL WAS SENT FOR COLLECTION. ON DEW DATE THE BILL WAS DISHONOURED
BY ANAND?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (GOVIND)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
4/6/14 ANAND A/C DR 4,500
TO SALES A/C 4,500
(BEING SOLD GOODS TO ANAND)
4/6/14 BILLS RECEIVABLE A/C DR 4,500
TO ANAND A/C 4,500
(BEING THE BILL DRAWN)
4/6/14 B.S.F.C A/C DR 4,500
TO BILLS RECEIVABLE A/C 4,500
(BEING THE BILL SENT FOR COLLECTION)
1/10/14 ANAND A/C DR 4,500
TO B.S.F.C A/C 4,500
(BEING THE BILL WAS DISHONOURED)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (ANAND)

DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
4/6/14 PURCHASES A/C DR 4,500
TO GOVIND A/C 4,500
(BEING GOODS PURCHASED FROM GOVIND)
4/6/14 GOVIND A/C DR 4,500
TO BILLS PAYABLE A/C 4,500
(BEING THE BILL WAS ACCEPTED)
1/10/14 BILLS PAYABLE A/C DR 4,500
TO GOVIND A/C 4,500
(BEING BILL WAS DISHONOURED ON DEW DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ 4 MODELS HONOURED
9. A BILL OF EXCHANGE FRO RS. 1,000 IS DRAWN BY A ON B AND ACCEPTED BY THE
LETTER PAYABLE AT STATE BANK OF INDIA FOR 3 MONTHS. SHOW THE JOURNAL ENTRIES
IN THE BOOKS OF MR. A UNDER EACH OF THE FOLLOWING CIRCUMSTANCES ASSUMING
THAT THE BILL WAS HONOURED ON ALL THE FOLLOWING CONDITIONS?
A. IF ‘A’ RETAINED THE BILL TILL THE DUE DATE
B. IF ‘A’ GOT IT DISCOUNTED WITH HIS BANKERS FOR RS. 950
C. IF THE BILL ENDORSED IT HIS CREDITOR MR. ‘C’
D. IF HE SENT THE BILL TO THE BANK COLLECTION?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (X)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
BILLS RECEIVABLE A/C DR 1,000
TO ‘B’ A/C 1,000
(BEING 3 MONTHS BILL RECEIVED)
A) BANK A/C DR 1,000
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL HONOURED ON THE DUE
DATE)
B) BANK A/C DR 950
DISCOUNT A/C DR 50
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL DISCOUNTED)
C) ‘C’ A/C DR 1,000
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL ENDORSED ‘C’)
D) B.S.F.C A/C DR 1,000
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL SENT FOR COLLECTION)
BANK A/C DR 1,000
TO B.S.F.C A/C 1,000
(BEING THE BILL HONOURED ON DUE DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ 4 MODELS DISHONOURED
10. ‘X’ GOT AN ACCEPTANCE FROM ‘Y’ FOR RS. 10,000. WRITE JOURNAL ENTRIES IN
THE BOOKS OF ‘X’. THE BILL IS DISHONOURED ON THE DUE DATE?
A. ‘X’ RETAINED THE BILL
B. ‘X’ DISCOUNTED IT FOR RS. 9,750
C. ‘X’ ENDORSES THE BILL TO HIS CREDITOR RAO & CO
D. ‘X’ SENT THE BILL TO BANK FOR COLLECTION?
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (X)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
BILLS RECEIVABLE A/C DR 10,000
TO ‘Y’ A/C 10,000
(BEING 3 MONTHS BILL RECEIVED)
A) ‘Y’ A/C DR 10,000
TO BILLS RECEIVABLE A/C 10,000
(BEING THE BILL DISHONOURED ON THE DUE
DATE)
B) BANK A/C DR 9,750
DISCOUNT A/C DR 250
TO BILLS RECEIVABLE A/C 10,000
(BEING THE BILL DISCOUNTED)
‘Y’ A/C DR 10,000
TO BANK A/C 10,000
(BEING THE AMOUNT PAID TO THE BANK ON
DISHONOURED)
C) RAO & CO A/C DR 10,000
TO BILLS RECEIVABLE A/C 10,000
(BEING THE BILL ENDORSED)
‘Y’ A/C DR 10,000
TO RAO & CO A/C 10,000
(BEING THE DISHONOUR OF ‘Y’ S ACCEPTANCE
ENDORSED TO RAO & CO)
D) B.S.F.C A/C DR 10,000
TO BILLS RECEIVABLE A/C 10,000
(BEING THE BILL SENT FOR COLLECTION)
‘Y’ A/C DR 10,000
TO B.S.F.C A/C 10,000
(BEING THE BILL DISHONOURED ON DUE DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE→ NOTING CHARGES
11. ‘X’ SOLD 1,000 RS OF GOODS TO ‘Y’ ON CREDIT FOR THAT ‘X’ WROTE A THREE MONTHS BILL ON ‘Y’ AND ACCEPTED BY ‘Y’. ON DUE DATE
BILL WAS DISHONOURED.
A. UPTO DUE DATE ‘X’ RETAINED THE BILL AND BILL DISHONOURED PAID NOTING CHARGES 20 RS.
B. ‘X’ THIS BILL WAS DISCOUNTED AT 6% FINALLY BILL WAS DISHONOURED PAID 20 RS NOTING CHARGES.
C. ‘X’ THIS BILL WAS ENDORSED TO HIS CREDITOR ‘Z’ ON DUE DATE BILL WAS DISHONOURED PAID 20 RS NOTING CHARGES.
D. ‘X’ THIS BILL WAS SENT FOR COLLECTION FOR THAT THE BILL DISHONOURED PAID NOTING CHARGES 20 RS.
A) JOURNAL ENTRIES IN THE BOOKS OF DRAWER (X)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
‘Y’ A/C DR 1,000
TO SALES A/C 1,000
(BEING SOLD GOODS TO ‘Y’)
BILLS RECEIVABLE A/C DR 1,000
TO ‘Y’ A/C 1,000
(BEING 3 MONTHS BILL RECEIVED)
A) ‘Y’ A/C DR 1,020
TO BILLS RECEIVABLE A/C 1,000
TO BANK A/C 20
(BEING THE BILL DISHONOURED ON THE DUE DATE PAID NOTING
CHARGES)
B) BANK A/C DR 985
DISCOUNT A/C DR 15
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL DISCOUNTED)
‘Y’ A/C DR 1,000
TO BANK A/C 1,000
(BEING THE AMOUNT PAID TO THE BANK ON DISHONOURED SO
PAID NOTING CHARGES)
C) ‘Z’ A/C DR 1,000
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL ENDORSED)
‘Y’ A/C DR 1,020
TO ‘Z’ A/C 1,020
(BEING THE DISHONOUR OF ‘Y’ S ACCEPTANCE ENDORSED TO ‘Z’
AND PAID NOTING CHARGES)
D) B.S.F.C A/C DR 1,000
TO BILLS RECEIVABLE A/C 1,000
(BEING THE BILL SENT FOR COLLECTION)
‘Y’ A/C DR 1,020
TO B.S.F.C A/C 1,000
TO BANK A/C 20
(BEING THE BILL DISHONOURED ON DUE DATE SO PAID NOTING
CHARGES)

JOURNAL ENTRIES IN THE BOOKS OF DRAWEE (Y)

DATE PARTICULARS LF DEBIT(RS) CREDIT(RS)
PURCHASES A/C DR 1,000
TO ‘X’ A/C 1,000
(BEING GOODS PURCHSED FROM ‘X’)
‘X’ A/C DR 1,000
TO BILLS PAYABLE A/C 1,000
(BEING BILL WAS ACCEPTED)
BILLS PAYABLE A/C DR 1,000
NOTING CHARGES, A/C DR 20
TO ‘X’ A/C 1,020
(BEING BILL DISHONOURED PAID NOTING CHARGES)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE → RENEWAL OF A BILL
ST
12. ON 1 SEP 2014 HARI PURCHASED GOODS FOR RS. 12,000 FROM SEKHAR AND
ACCEPTED A BILL FOR THE SAME DRAWN BY SEKHAR PAYAABLE AFTER 3 MONTHS.
ON THE DATE OF MATUURITY HARI OFFERED TO PAY RS. 6,000 AND REQUESTED
SEKHAR TO DRAW NEW BILL FOR 3 MONTHS FOR THE BALANCE AMOUNT
INCLUDING INTEREST AT 12%. SEKHAR AGREED TO THIS PROPOSAL?
A)
JOURNAL ENTRIES IN THE BOOKS OF SEKHAR (DRAWER)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/9/14 HARI A/C DR 12,000
TO SALES A/C 12,000
(BEING THE GOODS SOLD TO HARI)
1/9/14 BILLS RECEIVABLE A/C DR 12,000
TO HARI A/C 12,000
(BEING THE BILL DRAWN FOR 3 MONTHS)
4/12/14 HARI A/C DR 12,000
TO BILLS RECEIVABLE A/C 12,000
(BEING THE ORIGINAL BILL CANCELLED
FOR RENEWAL)
4/12/14 CASH A/C DR 6,000
TO HARI A/C 6,000
(BEING PARTIAL AMOUNT RECEIVED
FROM HARI)
4/12/14 HARI A/C DR 180
TO INTEREST A/C 180
(BEING INTEREST DUE 12% ON RS.6,000
FOR 3 MONTHS)
4/12/14 BILLS RECEIVABLLE A/C DR 6,180
TO HARI A/C 6,180
(BEING THE NEW BILL DRAWN FOR THE
BALANCE AMOUNT INCLUDING INTEREST)

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 JOURNAL ENTRIES IN THE BOOKS OF HARI (DRAWEE)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/9/14 PURCHASES A/C DR 12,000
TO SEKHAR A/C 12,000
(BEING THE GOODS PURCHASED FROM
SEKHAR)
1/9/14 SEKHAR A/C DR 12,000
TO BILLS PAYABLE A/C 12,000
(BEING THE BILL ACCEPTED FOR 3
MONTHS)
4/12/14 BILLS PAYABLE A/C DR 12,000
TO SEKHAR A/C 12,000
(BEING THE ORIGINAL BILL CACELLED FOR
THE RENEWAL)
4/12/14 SEKHAR A/C DR 6,000
TO CASH A/C 6,000
(BEING THE PARTIAL AMOUNT PAID TO
SEKHAR)
4/12/14 INTEREST A/C DR 180
TO SEKHAR A/C 180
(BEING INTEREST DUE 12% ON RS. 6,000
FOR 3 MONTHS)
4/12/14 SEKHAR A/C DR 6,180
TO BILLS PAYABLE A/C 6,180
(BEING THE NEW BILL ACCEPTED FOR 3
MONTHS)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE → RENEWAL OF A BILL
13. VISWANADH SOLD GOODS TO SRINIVAS ON 1ST APRIL 2014 FOR RS. 4,000 AND
DREW A BILL FOR 3 MONTHS ON SRINIVAS FOR THE SAME AMOUNT. SRINIVAS
ACCEPTED THE BILL AND RETURNED IT TO VISWANADH. ON THE DUE DATE
SRINIVAS REQUESTED VISWANADH TO DRAW A NEW BILL FOR THE PERIOD OF 3
MONTHS. SRINIVAS AGREED TO PAY INTEREST IN CASH 9% IMMEDIATELY.
VISWANADH AGREED TO THIS PROPOSAL. THE NEW BILL WAAS HONOURED ON
DUE DATE?
A)
JOURNAL ENTRIES IN THE BOOKS OF VISWANADH (DRAWER)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/4/14 SRINIVAS A/C DR 4,000
TO SALES A/C 4,000
(BEING THE GOODS SOLD TO SRINIVAS)
1/4/14 BILLS RECEIVABLE A/C DR 4,000
TO SRINIVAS A/C 4,000
(BEING THE BILL DRAWN FOR 3 MONTHS)
4/7/14 SRINIVAS A/C DR 4,000
TO BILLS RECEIVABLE A/C 4,000
(BEING THE ORIGINAL BILL CANCELLED
FOR RENEWAL)
4/7/14 CASH A/C DR 90
TO INTEREST A/C 90
(BEING INTEREST RECEIVED IN CASH)
4/7/14 BILLS RECEIVABLE A/C DR 4,000
TO SRINIVAS A/C 4,000
(BEING THE NEW BILL DRAWN FOR 3
MONTHS ON SRINIVAS)
7/10/14 CASH A/C DR 4,000
TO BILLS RECEIVABLE A/C 4,000
(BEING THE NEW BILL AMOUNT RECEIVED
ON DUE DATE)

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 JOURNAL ENTRIES IN THE BOOKS OF SRINIVAS (DRAWEE)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/4/14 PURCHASES A/C DR 4,000
TO VISWANADH A/C 4,000
(BEING THE GOODS PURCHASED FROM
VISWANADH)
1/4/14 VISWANADH A/C DR 4,000
TO BILLS PAYABLE A/C 4,000
(BEING THE BILL ACCEPTED FOR 3
MONTHS)
4/7/14 BILLS PAYABLE A/C DR 4,000
TO VISWANADH A/C 4,000
(BEING THE ORIGINAL BILL CANCELLED
FOR RENEWAL)
4/7/14 INTEREST A/C DR 90
TO CASH A/C 90
(BEING INTEREST PAID IN CASH)
4/7/14 VISWANADH A/C DR 4,000
TO BILLS PAYABLE A/C 4,000
(BEING THE NEW BILL ACCEPTED FOR 3
MONTHS)
7/10/14 BILLS PAYABLE A/C DR 4,000
TO CASH A/C 4,000
(BEING THE NEW BILL AMOUNT PAID ON
DUE DATE)

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 DEGREE 2ND SEMESTER ACCOUNTS 10 MARKS PROBLEM
BILLS OF EXCHANGE → RENEWAL OF A BILL
ST
14. ON 1 MARCH 2013 JAGANNADHAM SOLD GOODS TO CHIDAMBARAM FOR RS.
24,000 AND DREW UPON HIM A BILL FOR THE SAME AMOUNT PAYABLE AFFTER 3
MONTHS. ON THE DUE DATE CHIDAMBRAM REQUESTED JAGANNADHAM TO
RENEW THE BILL FOR A FURTHER PERIOD OF 3 MONTHS AT 9% INTEREST PER
ANNUM. JAGANNADHAM AGREED TO THIS PROPOSAL. CHIDAMBARAM ACCEPTED
A NEW BILL DRAWN BY JAGANNADHAM FOR THE AMOUNT OF OLD BILL INCLUDING
INTEREST PAYABLE AFTER 3 MONTHS. ON THE DUE DATE NEW BILL WAS
DISHONOURED?
A)
JOURNAL ENTRIES IN THE BOOKS OF JAGANNADHAM (DRAWER)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/3/13 CHIDAMBARAM A/C DR 24,000
TO SALES A/C 24,000
(BEING THE GOODS SOLD TO
CHIDAMBARAM)
1/3/13 BILLS RECEIVABLE A/C DR 24,000
TO CHIDAMBARAM A/C 24,000
(BEING THE BILL DRAWN FOR 3 MONTHS)
4/6/13 CHIDAMBARAM A/C DR 24,000
TO BILLS RECEIVABLE A/C 24,000
(BEING THE ORIGINAL BILL CANCELLED FOR
RENEWAL)
4/6/13 CHIDAMBARAM A/C DR 540
TO INTEREST A/C 540
(BEING INTEREST RECEIVED IN CASH)
4/6/13 BILLS RECEIVABLE A/C DR 24,540
TO CHIDAMBARAM A/C 24,540
(BEING THE NEW BILL DRAWN FOR 3
MONTHS ON CHIDAMBARAM)
7/9/13 CHIDAMBARAM A/C DR 24,540
TO BILLS RECEIVABLE A/C 24,540
(BEING THE NEW BILL DISHONOURED ON
DUE DATE)

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 JOURNAL ENTRIES IN THE BOOKS OF CHIDAMBARAM (DRAWEE)
DATE PARTICULARS LF DEBIT (RS) CREDIT (RS)
1/3/13 PURCHASE A/C DR 24,000
TO JAGANNADHAM A/C 24,000
(BEING THE GOODS PURCHASED FROM
JAGANNADHAM)
1/3/13 JAGANNADHAM A/C DR 24,000
TO BILLS PAYABLE A/C 24,000
(BEING THE BILL ACCEPTED FOR 3
MONTHS)
4/6/13 BILLS PAYABLE A/C DR 24,000
TO JAGANNADHAM A/C 24,000
(BEING THE ORIGINAL BILL CANCELLED FOR
RENEWAL)
4/6/13 INTEREST A/C DR 540
TO JAGANNADHAM A/C 540
(BEING INTEREST PAYABLE FOR THE
ADDITIONAL PERIOD FOR NENEWAL OF A
BILL)
4/6/13 JAGANNADHAM A/C DR 24,540
TO BILLS PAYABLE A/C 24,540
(BEING THE NEW BILL ACCEPTED FOR 3
MONTHS)
7/9/13 BILLS PAYABLE A/C DR 24,540
TO JAGANNADHAM A/C 24,540
(BEING THE NEW BILL DISHONOURED ON
THE DUE DATE)

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