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4,000 2.800 1,200 (Being honour of acceptance) Bank Alc Dr. 1.200 B A/C Dr. Bad Debts Alc Dr. 2.800 To Deficiency Alc To AA/ 4,000 To Bank A/C (Being receipt of dividend (Being amount of 30 paise in out of insolvency the rupee paid) proceedings) B'S BOOKS A ACCOUNT 2005 Rs. 2005 July 1 To Discount Alc 60 July 1 By Bills receivable Alc July 1 To Bank Alc 1,940 Sept. 4 By Discount Alc Sept. 4 To Bills payable Alc 10,000 Sept 4 By Bank A/c Dec. 7 By Bank A/c Dec. 7 By Bad Debts Alc 12,000 Rs. 5.000 90 2.910 1,200 2,800 12.000 Rs. 2005 uly To Bills payable Alc Sept. 4 To Discount Alc Sept. 4 To Bank A/c Dec. 7 To Bank A/C Dec. 7 To Deficiency Alc A'S BOOKS B ACCOUNT Rs. 2005 5,000 July 1 By Disc Alc 90 July 1 By Bank A/C 2,910 Sept. 4 By Bills Receivable A/c 1,200 2.800 12.000 1,940 10.000 12.000 912 PROBLEM 12. P and R were in need of funds. Therefore, on 1st June 2004, P accepted a Bill for Rs. 5,000 drawn by R for three months. R got the bill discounted at 8% p.a. from Punjab Bank and remitted half of the proceeds of P. On the due date, however, R was not in a position to send the remaining half of the amount to P. On 29th August 2004 however, he agreed to accept a Bill for Rs. 2,520 (inclusive of interest) drawn by P for three months, which P discounted for Rs. 2,500. On the due date, R honoured the Bill. Give journal entries in the books of P and R. (B. Com., Punjab)

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