Q.Q. 4. On 1st March, 2016 Meenakshi sold goods to Neeta worth ₹ 40,000. Neeta accepted a bill for 3 months drawn by Meenakshi on 1st March, 2016.
On 31st May, 2016 Neeta requested Meenakshi to renew the bill. Meenakshi agreed on condition that Neeta should pay ₹ 10,000 in cash and accept a new bill for the balance amount plus interest @ 12% p.a. for 2 months.
Neeta accepted the new bill drawn for two months plus interest. On the due date the new bill was honoured.
Give Journal Entries in the books of Meenakshi and prepare Neeta's account in the books of Meenakshi.

Dishonour occurs when the drawee fails to pay on the due date; the debt reverts to an ordinary personal account, increased by any noting charges (the Notary's fee for certifying the dishonour, recoverable from the defaulting drawee). Drawer: Drawee's A/c Dr (bill amount + noting charges), To Bills Receivable A/c (if retained) or To Bank A/c (if discounted/collected — the bank recovers its payment plus noting charges from the drawer). Drawee: Bills Payable A/c Dr + Noting Charges A/c Dr, To Drawer's A/c. Renewal: before the due date, the drawee requests cancellation of the old bill and a fresh bill (usually plus interest) for a later date — three-step entries (cancel old bill, charge/record interest, record new bill) mirrored in both parties' …