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Question -

On 01 Feb, 2016, John purchased goods for ₹ 15,000 from Jimmi. He immediately made a payment of ₹ 5,000 by cheque and for the balance accepted the bill of exchange drawn upon him by Jimmi. The bill of exchange was payable after 40 days. Five days before the maturity of the bill, Jimmi sent the same to his bank for collection. The bank duly presented the bill to John on the due date who met the bill. The bank informed the same to Jimmi. Prepare John’s account in the books of Jimmi and Jimmi account in the books of John.



Answer -

Books of Jimmi

Journal

Date

Particulars

L.F.

Debit

Amount

Credit

Amount

2016

01 Feb

John

Dr.

15,000

To Sales A/c

15,000

(Goods traded to John)

01 Feb

Bank A/c

Dr.

5,000

To John

5,000

(Cheque acknowledged for ₹ 5,000 from John)

01 Feb

Bills Receivable A/c

Dr.

10,000

To John

10,000

(Bill received from John for 40 days)

10 Mar

Bill Sent for Collection A/c

Dr.

10,000

To Bills Receivable A/c

10,000

(John’s approval sent to bank for collection)

15 Mar

Bank A/c

Dr.

10,000

To Bill Sent for Collection A/c

10,000

(John’s approval met on due date and bank

got the payment)

Ledger 

John’s Account

Dr.

Cr.

Date

Particulars

J.F.

Amount ₹

Date

Particulars

J.F.

Amount ₹

2016

2016

01 Feb

Sales

15,000

01 Feb

Bank

5,000

01 Feb

Bills Receivable

10,000

15,000

15,000

 

Books of John

Journal

Date

Particulars

L.F.

Debit 

Amount 

Credit

Amount

2016

01 Feb

Purchases A/c

Dr.

15,000

To Jimmi

15,000

(Goods purchased from Jimmi)

01 Feb

Jimmi

Dr.

5,000

To Bank A/c

5,000

(Cheque payment done to Jimmi)

01 Feb

Jimmi

Dr.

10,000

To Bills Payable A/c

10,000

(Bill drawn by Jimmi acknowledged for 40 days)

15 Mar

Bills Payable A/c

Dr.

10,000

To Bank A/c

10,000

(Payment of bill done on maturity to bank)

Ledger 

Jimmi’s Account

Dr.

Cr.

Date

Particulars

J.F.

Amount ₹

Date

Particulars

J.F.

Amount ₹

2016

2016

01 Feb

Bank

5,000

01 Feb

Purchases

15,000

01 Feb

Bills Payable

10,000

15,000

15,000

 

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