Ektaa Utkarsh classes

Bills of exchange (any two)

Problem No.1). On 1st March, 2014. Bheem sold goods to Raju worth Rs. 10,000/- and Raju accepted
the Bill for Rs. 10,000/- at 3 months drawn by Bheem. Bheem discounted the bill with his bank @ 10%
p.a. On due date the bill was dishonoured and Raju requested Bheem to accept Rs. 4,000/- immediately
and draw upon him a new bill for the remaining amount at 3 months together with an interest @ 10%
p.a. Bheem agreed. The second Bill was duly honoured. Give Journal entries in the books of Bheem.
Problem No.2). Sachin sold goods to Dhoni worth Rs. 1,00,000/- and Dhoni accepted the bill for Rs.
1,00,000/- at 3 months drawn by Sachin. Sachin discounted the bill with his bank @ 10 % p.a. On due
date the bill was dishonoured and Dhoni requested Sachin to accept Rs. 40,000 immediately and draw
upon him a new bill for the remaining amount at 3months together with an interest at 10% p.a. Sachin
agreed and the second bill was duly honoured. Give the Journal entries in the books of sachin and
dhoni.
Problem No.3). Rose purchased goods from Lilly on credit for Rs. 2,000. On next day Rose accepted a
bill drawn by Lilly for the balance amount for four months. Lilly discounted the bill with her bank for
Rs. 1960/-. Before the due date Rose approached Lilly with a request to renew the Bill. Lilly agreed
with the condition that Rose should pay Rs. 1600 along with interest of Rs. 12 and accept a new bill for
the balance. These arrangements were duly carried out. Rose became insolvent and and 50 paisa in a
rupee could be recovered from her. Pass journal entries books of Lilly and prepare Rose account.4
Problem No.4. Journalize the following transactions in the books of Maharaja. [Ans]
i. Ayub informs Maharaja that Sadashivs acceptance for Rs. 2,000 endorsed to Ayub has been
dishonoured, noting charges amounted to Rs. 150.
ii. Pankaj renews his acceptance to Maharaja for Rs. 1200 by paying Rs. 400 in cash and accepting a
fresh bill for the balance plus interest at 12% p.a. for 3 months..
iii. Vaibhavs acceptance to Maharaja for Rs. 6000 retired one month before the due date at a discount of
12%p.a.
iv. Bank informs Maharaja as to the dishonour of Kasams acceptance for Rs. 2000 to Maharaja
discounted with Bank noting charges Rs. 200.
Problem No. 5
Journalise the following transactions in the books of Bhaskar.
i. Suresh informed Bhaskar that Nishads acceptance for Rs. 2500 endorsed to Suresh has been
dishonoured and noting charges amounted to Rs. 25.
ii. Rajesh renews his acceptance to Bhaskar for Rs. 7500 by paying Rs. 2500 in cash and accepting a
fresh bill for the balance plus interest @ 10% p.a. for three months.
iii. Mandar retired his acceptance to Bhaskar for Rs. 3,800 by paying Rs. 3750 in cash.
iv. Bhaskar sent a bill of Dayaram for Rs. 5000 to the bank for collection. But the bank informed that
the bill has been dishonoured by Dayaram.
Problem No.6. Ronaldo owes Ricardo Rs.80,000. Ricardo then draws a bill for Rs. 80,000 on Ronaldo
for a period of three months. Ronaldo accepts and return it to Ricardo. Ricardo discounted the bill with
his bank @ 10 % p.a. On due date, the bill was dishonoured noting charges amount to Rs. 300. Ricardo
then draws a bill for the balance plus interest of Rs. 1700. Before the due date of this bill Ronaldo pays
the amount at a discount of Rs. 400 to retire the bill. Journal Entries Ronaldo.
Problem No. 7

Sun draws a bill on Moon for Rs. 15,000 at 3 months. Moon accepts the bill and return to Sun. Sun
discounted the bill @ 10 % p.a. with the bank. On Maturity Moon finds herself unable to make payment
of the bill and requested Sun to renew the bill. Sun accepts the proposal on the condition that Moon
should Pay Rs. 12,000 in cash and accept a new bill at one month along with interest at 10% p.a. These
arrangements were carried through. Moon retires the bill by paying Rs. 3015/- Pass Journal Entries in
the books of Sun and prepare moon account.
Problem no.8.
Karthik accepted a bill for Rs. 20,000/- drawn by Jones at three months. Jones got the bill discounted
with his bank for Rs. 19,900. Before the due date Karthik approached Jones for renewal of the bill.
Jones agreed on the condition that Rs. 10,000/- be paid immediately together with interest on the
remaining amount at 6% p.a. For balance Karthik should accept a new bill for three months. These
arrangements were carried through but afterwards, Karthik become Insolvent and only 80 % of the
amount could be recovered from his estate. Give journal entries in the books of Karthik and prepare
karthik account.
9. Ajith accepted a bill for Rs. 10,000 drawn by Surya at three months. Surya got the bill discounted
with his bank for Rs. 9,700. Before the due date, Ajith approached Surya for renewal of the Bill. Surya
agreed on the condition that Rs. 7,000 is paid immediately together with an interest on remaining
amount at 18% p.a. for four months and for the balance Ajith should accept a new bill. But afterwards
Ajith become insolvent and only 25% of the amount could be recovered from her estate. Pass journal
entries in the books of Surya and prepare ajith account.
Problem no. 10
Journalise the following transactions int he books of Kedarnath:
1. Badrinath informs Kedarnath that Aloknath's Acceptance of Rs. 16,000 endorsed
to Badrinath has been dishonoured and noting charges amounted to Rs. 500.
2. Somnath renews his acceptance of Rs. 14,400 to Kedarnath by paying cash Rs.
4,400 and accepting a new bill for 2 months for the balance plus interest @ 12%
p.a.
3. Vishwanath retired his acceptance for Rs. 10,500 to Kedarnath by paying in cash
Rs. 10,250.

4. Recovered only 50% of the amount due from his private estate of Ramnath, who
declared as insolvent, against his bill of Rs. 12,500.
Q2. Prepare bills of exchange an
Drawer : Ramesh Mishra, L.B.S. Road, Ghatkopar, Mumbai
Drawee : Nandkumar Sharma, Laxmi Road, Pune
Payee: Rupesh Kumar Pande, Rajkamal Chowk, Amaravati.
Period of bill: 90 days
Amount of bill : Rs. 25,000

Date of Bill: 17th February, 2014

Date of Acceptance: 20th February, 2014
Accepted for : Rs. 20,000 only.