1.

X draws on Y a bill for ₹ 4,000 which was duly accepted by Y. Y meets the bill on its due date. Show what entries would be passed in the books of X and Y under each of the following circumstances:(i) If X retains the bill till due date.(ii) If X discounts the same with his banker paying ₹ 100 for discount.(iii) If X endorses the same to his creditor Z, in full settlement of his debt of ₹ 4,080.(iv) If X sends the bill to his banker for collection.

Answer» X draws on Y a bill for ₹ 4,000 which was duly accepted by Y. Y meets the bill on its due date. Show what entries would be passed in the books of X and Y under each of the following circumstances:

(i) If X retains the bill till due date.

(ii) If X discounts the same with his banker paying ₹ 100 for discount.

(iii) If X endorses the same to his creditor Z, in full settlement of his debt of ₹ 4,080.

(iv) If X sends the bill to his banker for collection.


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