both Ashok ans Bishan and prepare Bishan’s account in Ashok’s books and Ashok’s account in Bishan’s books. Solution Books of Ashok Oct. Bishan’s A/c , To Sales A/c , (Sold goods to Bishan on credit) Oct. Bills Receivable A/c , To Bishan’s A/c , (Received three acceptances from Bishan.
First for Rs. , payable after two months, second for Rs. , payable after three months and the third for Rs. , payable after four months) Oct.
Chetan’s A/c To Bills receivable A/c (Endorsed second bills in favour of creditor Chetan) Dec. , Discount A/c To Bill receivable A/c , (Third bill discounted at % p.a.) Jan. , Bills receivable A/c , (Bishan met his first acceptance on due date) Mar. Bishan A/c , , (Bishan dishonoured his third acceptance and bank paid Rs.
as noting charges) Mar. Cash A/c , To Bishan’s A/c , (Cash received from Bishan) Mar. Bishan’s A/c To Interest A/c (Interest charged from Bishan for the extended period) Mar. Bills Receivable A/c , To Bishan’s A/c , (Received new acceptance from Bishan for two months) May , To bills Receivable A/c , (Bishan met his new acceptance on maturity) Bishan’s Account Cr.
Sales , Oct. Bills Receivable , Mar. Bank , Mar. Cash , Mar.
Interest Mar. Bills Receivable , , , Books of Bishan Amount Amount Oct. Purchases A/c , To Ashok’s A/c , (Purchases goods on credit from Ashok) Oct. Ashok’s A/c , To Bills Payable A/c , (Accepted three drafts of Ashok, the first for Rs.
, payable after months, second for Rs. , Payable after months and the third for Rs. , Payable after months) Jan. Bills Payable A/c , , (Met first acceptance for Rs.
, in favour of Ashok.) Mar. Bill Payable A/c , Noting charges A/c To Ashok A/c , (Third acceptance in favour of Ashok dishonoured and noting charges Rs. )