Bill of Exchange
XI ACCOUNTANCY
Saurabh Special
Qs. 1 “A” draws a bill on “B” for Rs.3,000 on 1stJanuary ,2009 payable after three months.
The Bill is discounted by ‘A’ as he is immediate needs of fund. Calculate discount in the
following casesa. The bill has been discounted for Rs. 2,900.
b. The bill has been discounted @12 %
c. The bill has been discounted @12 % on Jan. 2009.
d. The bill has been discounted @ 12% on Feb 2009
Qs. 2 A bill for Rs. 1,000 is drawn by A on B and accepted by the latter payable at the New
Bank of India . Shows what entries should be passed in the books of A under each of the
following circumstances :
i. If A retained the bill till the due date and then realised it on maturity .
ii. If A discounted it with his bankers for Rs. 950 .
iii. If A endorsed it to his creditor C in full settlement of his debt .
iv.
If A sent it to his bankers for collection .
Also, give the necessary entries in each of the cases if the bill is dishonoured .
Qs. 3 ‘Shiksha’ drew on ‘Prerna’ a bill of exchange for Rs. 1,00,000 on January 1, payable
after 3 months from January 1 which Prerna accepted. On January 4, Shiksha discounted
the bill with her banker at 18% p.a. Prerna failed to meet the bill on due date and the bill
was returned to Shiksha with noting charges Rs. 200 debited to her by the bank. Shiksha
received a new bill for bill value plus noting charges from Prerna payable after 2 months.
However, only 40% of the amount claimed could be recovered by Shiksha on June, 8 as
Prerna was declared insolvent on that day.
Pass Journal entries in the book of Shiksha for the above transactions.
Qs. 4 On 1.1.2008, Ram accepted a bill of exchange drawn by Shyam for Rs. 50,000. The bill
was payable after three months. On 1.2.2008 Shyam endorsed this bill in favour of
Govind for the same amount. Ram dishonored the bill and the Govind paid Rs. 100 as
noting charges. On 03.04.2008 Ram accepted another bill for the amount then due from
him for another two months. Shyam immediately discounted the bill with his banker @
12% p.a. this bill was settled under a rebate @12% one month before the due date.
Record necessary journal entries in the books Shyam.
Qs. 5 Rashmi owed Monika Rs. 10,000. On 2nd January, Rashmi accepted four bills of
exchange drawn by Monika to discharge the whole debt. The first for Rs. 1,000 at one
month, the second for Rs. 2,000 at two months, the third for Rs. 3,000 at three months
and the last one for Rs. 4,000 at four months. On 15th January, Monika sent the first bill
to the bank for collection. On 17th January she endorsed the second bill in favour of
Sonika. On 5th February, she got the fourth bill discounted with the bank @ 8% per
annum. The first three bills were duly honored but the fourth one was dishonoured on
the due date, noting charges being Rs. 50. Show journal entries in the books of Rashmi.
Qs. 6 On 1.1.2012, Ram accepted a bill of exchange drawn by Shyam for Rs. 50,000. The bill
was payable after four months. On 1.2.2010 Shyam endorsed this bill in favour of Govind
for Rs. 55,000 in full and final settlement. Ram dishonored the bill and the Govind paid
Rs. 100 as noting charges. After five days Ram accepted another bill for the amount
including interest @ 12% p.a. from him for another two months. Shyam immediately
discounted the bill with his banker @ 12% p.a. this bill was settled under a rebate @12%
one month before the due date. Record necessary journal entries in the books Shyam.
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Qs. 7 On 15.04.2009 B accepted three bills of exchange for Rs 2400 , No.01 for Rs 700 for one
month ; No. 02 for Rs 800 for two months; and No. 03 for Rs 900 for three months on
dated 20.04.2009. A endorse bill No 01 to his creditor C to clear his account of RS 710,
discounted his bill No. 02 on dated 22.04.2009 with his banker for Rs 792 and retained
the third bill till maturity Bill No. 01 was met on due date ,bill No. 02 dishonored on due
date Rs 10 being paid for noting charges . ‘A’ charged ‘B’ Rs 15 for interest and drew on
him a fourth bill for Rs 825 for three months and B accepted it and retuned . Bill No
03 and 04 were met on due date.
Pass journal entries in the books of A only.
Qs. 8 On 1.1.2012, Star accepted a bill of exchange drawn by Moon for Rs. 50,000. The bill
was payable after three months. On 1.2.2012 Moon endorsed this bill in favour of Govind
for the same amount. Star dishonored the bill and the Govind paid Rs. 100 as noting
charges. On 03.04.2012 Ram accepted another bill for the amount then due from him for
another two months. Moon immediately discounted the bill with his banker @ 12% p.a.
this bill was settled under a rebate @12% one month before the due date. Record
necessary journal entries in the books Star, Moon and Govind.