Question No 13 Chapter No 13 – D.K Goal 11 Class

Question No 13 Chapter No 13

Dishonour and Renewal of Bill

13. A sells goods for 30,000 to B on 1st January, 2018 and on the same day draws a bill on B at three months for the amount. B accepts it and returns it to A, who discounts it on 4th February, 2017 with his bank at 18% per annum. The acceptance is dishonoured on the due date, the noting charges paid by the bank being 200.
On 4th April, 2017, B accepts a new bill at two months for the amount then due to A together with interest at 12 per cent per annum.
Make Journal entries to record these transactions in the books of A and B.

The solution of Question No 13 Chapter No 13: –

In the books of A (Drawer)
Date	Particulars		L.F.	Debit	Credit
2016
Jan.01	B A/c	Dr.		30,000
	To Sale A/c				30,000
	(Being Goods sold to B )
Jan.01	Bills Receivable A/c	Dr.		30,000
	To Dinesh A/c				30,000
	(Being B accepted the bill)
Mar.04	Bank A/c	Dr.		29,100
	Discounting Charges A/c	Dr.		900
	To Bills Receivable A/c				30,000
	(Being Bill discounted with the bank @18%)
Apr. 04	B A/c	Dr.		30,200
	To Bank A/c				30,200
	(Being Bill dishonoured on due date and noting charges paid)
Apr. 04	B A/c	Dr.		604
	To Interest A/c				604
	(Being Cash received from Dinesh)
Apr. 04	Bills Receivable A/c	Dr.		30,804
	To B A/c				30,804
	(Being Dinesh accepted the new bill)
Jul.07	Cash A/c	Dr.		30,804
	To Bills Receivable A/c				30,804
	(Being Bill honoured on due date)

In the books of B (Drawee)
Date	Particulars		L.F.	Debit	Credit
2016
Jan. 01	Purchases A/c	Dr.		30,000
	To A A/c				30,000
	(Being Goods purchased from A)
Jan. 01	A A/c	Dr.		30,000
	To Bills Payable A/c				30,000
	(Being Bill drawn by X, accepted)
Apr. 04	Bills Payable A/c	Dr.		30,000
	Noting Charges A/c	Dr.		200
	To A A/c				30,200
	(Being Bill dishonoured on due date and noting charges paid)
Apr. 04	Interest A/c	Dr.		604
	To A A/c				604
	(Being Interest due to be paid)
Mar. 04	Interest A/c	Dr.		2,400
	To Chander				2,400
	(Being interest due to being paid)
Apr. 04	A A/c	Dr.		30,804
	To Bills Payable A/c				30,804
	(Being New bill drawn by A, accepted)
Jul. 04	Bills Payable A/c	Dr.		30,804
	To Cash A/c				30,804
	(Being interest due to be paid)

Working Note: –

Calculation of Discounting Charges

Discounting Charges	=	30,000	x	18	X	2
				100		12
	=	Rs 900

Calculation of amount of Interest

Amount of Interest	=	30,000	x	12	X	2
				100		12
	=	Rs 604

https://tutorstips.com/bills-payable/

Also, Check out the solved question of all Chapters: –

D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution

• Chapter 1 Evolution of Accounting & Basic Accounting Terms
• Chapter 2 Accounting Equations
• Chapter 3 Meaning and Objectives of Accounting
• Chapter 4 Double Entry System
• Chapter 5 Books of Original Entry – Journal 
• Chapter 6 Accounting for Goods and Service Tax (GST) (Coming soon)
• Chapter 7 Books of Original Entry – Cash Book (Coming soon)
• Chapter 8 Books of Original Entry – Special Purpose Subsidiary Books (Coming soon)
• Chapter 9 Ledger (Coming soon)
• Chapter 10 Trial Balance and Errors (Coming soon)
• Chapter 11 Bank Reconciliation Statement (Coming soon)
• Chapter 12 Depreciation (Coming soon)
• Chapter 13 Bills of Exchange (Coming soon)
• Chapter 14 Generally Accepted Accounting Principles(GAAP) 
• Chapter 15 Bases of Accounting
• Chapter 16 Accounting Standards and International Financial Reporting Standard(IFRS) (Coming soon)
• Chapter 17 Capital and Revenue 
• Chapter 18 Provisions and Reserves 
• Chapter 19 Final Accounts (Coming soon)
• Chapter 20 Final Accounts – With Adjustments (Coming soon)
• Chapter 21 Errors and their Rectification (Coming soon)
• Chapter 22 Accounts from Incomplete Records – Single Entry System (Coming soon)
• Chapter 23 Accounts of Not-for-Profit Organisations (Coming soon)
• Chapter 24 Computerised Accounting System (Coming soon)
• Chapter 25 Introduction to Accounting Information System (Coming soon)

Check out the Accountancy Class +1 by D.K. Goal (Arya Publication) from their official Site.