Vimal purchased goods ₹25,000 from Kamal on Jan 15, 2016 and accepted a bill of exchange drawn upon him by Kam

Numerical Questions · Q13

Q. Vimal purchased goods ₹25,000 from Kamal on Jan 15, 2016 and accepted a bill of exchange drawn upon him by Kamal payable after two months. On the date of the maturity the bill was duly presented for payment. Vimal dishonoured the bill. Record the necessary journal entries in the books of Kamal and Vimal when: The bill was retained by Kamal till the date of its maturity. The bill was immediately discounted by Kamal with his bank @ 6% p.a. The bill was endorsed by Kamal in favour of his creditor Sharad. Five days before its maturity the bill was sent by Kamal to his bank for collection.

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Goods sold on Jan 15, 2016; bill for 2 months ⇒ maturity = March 18, 2016 (Mar 15 + 3 days of grace). No noting charges are stated, so dishonour is a simple reversal of ₹25,000 in every case. Case (b) discount = ₹25,000 × 6% × 2/12 = ₹250, so Bank receives ₹24,750. Vimal's entries are identical under all four cases.

Case (a) — Bill retained by Kamal till maturity

In the Books of Kamal — Journal

Date	Particulars	Debit (₹)	Credit (₹)
2016 Jan. 15	Vimal's A/c Dr.	25,000
	To Sales A/c		25,000
2016 Jan. 15	Bills Receivable A/c Dr.	25,000
	To Vimal's A/c		25,000
2016 Mar. 18	Vimal's A/c Dr.	25,000
	To Bills Receivable A/c		25,000

Case (b) — Bill discounted by Kamal @ 6% p.a.

In the Books of Kamal — Journal

Date	Particulars	Debit (₹)	Credit (₹)
2016 Jan. 15	Vimal's A/c Dr.	25,000
	To Sales A/c		25,000
2016 Jan. 15	Bills Receivable A/c Dr.	25,000
	To Vimal's A/c		25,000
2016 Jan. 15	Bank A/c Dr.	24,750
	Discount A/c Dr.	250
	To Bills Receivable A/c		25,000
2016 Mar. 18	Vimal's A/c Dr.	25,000
	To Bank A/c		25,000

Case (c) — Bill endorsed to creditor Sharad

In the Books of Kamal — Journal

Date	Particulars	Debit (₹)	Credit (₹)
2016 Jan. 15	Vimal's A/c Dr.	25,000
	To Sales A/c		25,000
2016 Jan. 15	Bills Receivable A/c Dr.	25,000
	To Vimal's A/c		25,000
2016 Jan. 15	Sharad's A/c Dr.	25,000
	To Bills Receivable A/c		25,000
2016 Mar. 18	Vimal's A/c Dr.	25,000
	To Sharad's A/c		25,000

Case (d) — Bill sent for collection five days before maturity

In the Books of Kamal — Journal

Date	Particulars	Debit (₹)	Credit (₹)
2016 Jan. 15	Vimal's A/c Dr.	25,000
	To Sales A/c		25,000
2016 Jan. 15	Bills Receivable A/c Dr.	25,000
	To Vimal's A/c		25,000

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