Question

On 1^st December, 2023 Z purchased goods from R for Rs. 35,000 and accepted a bill for two months. The bill was met on due date. Pass journal entries for the above transactions in the books of Z.

Hint:

Bills payable are treated as liabilities in the books of the acceptor and must be settled on the maturity date to avoid dishonor.

Answer 1

The following journal entries will be recorded in the books of Z:

$Date$	Particulars	Debit (Rs.)	Credit (Rs.)
1st Dec 2023	Purchases A/c Dr. To R’s A/c (Being goods purchased on credit)	35,000	35,000
1st Dec 2023	R’s A/c Dr. To Bills Payable A/c (Being bill accepted by Z)	35,000	35,000
1st Feb 2024	Bills Payable A/c Dr. To Cash/Bank A/c (Being bill met on maturity date)	35,000	35,000