BILLS OF EXCHANGE

NAME : DIVYA MAHALE

 INTRODUCTION
• BILLS OF EXCHNAGE IS AN INSTRUMENT IN WRITING ,
CONTAINING AN UNCONDITIONAL ORDER SIGN BY MAKER
DIRECTING A CERTAIN PERSON, TO PAY ON DEMAND OR AT
FUTURE DATE , A CERTAIN SUM OF MONEY , BY THE ORDER OF
A CERTAIN PERSON ARE TO THE BEARER CHEQUE OF AN
INSTRUMENT.
IN THE BOOKS OF DRAWER
( JOURNAL ENTRIES)

1. FOR CREDIT SALES

ENTRY : DRAWEE ACCOUNT…..(DEBITED)

TO SALES ACCOUNT
2. FOR BILLS DRAWN
ENTRY : BILLS RECEIVABLE ACCOUNT …. (DEBITED)
TO DRAWEE ACCOUNT
3. FOR DISCOUNTING OF BILL

ENTRY: CASH/BANK ACCOUNT …..(DEBITED)

DISCOUNT ACCOUNT
TO BILL RECEIVABLE ACCOUNT
4.FOR ENDORSCEMENT OF BILL

ENTRY : ENDORSEE ACCOUNT ….(DEBITED)

TO BILLS RECEIVABLE ACCOUNT
5. FOR BILL SENT TO BANK FOR COLLECTION

ENTRY : BANK FOR COLLECTION ACCOUNT….( DEBITED)

TO BILLS RECEIVABLE ACCOUNT
 6. FOR HONOUR OF BI LL
a. IN THE HANDS OF DRAWER AND HONOUR
ENRTY: CASH ACCOUNT....(DEBITED)
TO BILLS RECEIVABLE ACCOUNT
b. IN THE HANDS OF BANK AND HONOUR
NO ENTRY
c. IN THE HANDS OF ENDORSEE AND HONOUR
NO ENTRY
d. IN THE HANDS BANK FOR COLLECTION AND COLLECTED BY BANK
ENTRY: BANK ACCOUNT….(DEBITED)
TO BANK FOR COLLECTION
 7. FOR DISHONOUR OF BILL
a. IN THE HANDS OF DRAWER AND DISHONOUR
ENTRY: DRAWEE ACCOUNT…(DEBITED)
TO BILLS RECEIVABLE
b. IN THE HANDS OF BANK AND DISHONOUR
ENRTY: DRAWEE ACCOUNT…(DEBITED)
TO BANK ACCOUNT
c. IN THE HANDS OF ENDORSEE AND DISHONOUR
ENTRY: DRAWEE ACCOUNT…(DEBITED)
TO ENDORSEE ACCOUNT
d. IN THE HANDS OF BANK FOR COLLECTION AND DISHONOUR
ENTRY: DRAWEE ACCOUNT…(DEBITED)
TO BANKS FOR COLLECETION ACCOUNT
 8. RENEWAL OF BILL
a. FOR CANCELLATION OF BILL(DISHONOUR)

ENTRY: DRAWEE ACCOUNT…(DEBITED)

TO BFC

b. FOR PARTLY CASH RECEIVED

ENTRY: CASH ACCOUNT…(DEBITED)

TO DRAWEE ACCOUNT

c. FOR INTEREST CHARGES

ENTRY: DRAWEE ACCOUNT..(DEBITED)

TO INTEREST ACCOUNT

d. FOR NEW BILL DRAWN

ENTRY: BILLS RECEIVABLE ACCOUNT…(DEBITED)

TO DRAWEE ACCOUNT
 9. FOR RETIREMENT OF BILL
ENTRY: CASH ACCOUNT…(DEBITED)
REBATE ACCOUNT…(DEBITED)
TO BILLS RECEIVABLE ACCOUNT
 10. FOR INSOLVECY IN CANCELLATION
(DISHONOUR)
a. CANCELLATION (DISHONOUR)
ENTRY: DRAWEE ACCOUNT…(DEBITED)
TO BFC
b. FOR CASH RECEIVED
ENTRT: CASH ACCOUNT…(DEBITED)
BAD DEBT ACCOUNT…(DEBITED)
TO DRAWEE ACCOUNT
THANK YOU