Mr. A sells goods for Rs. 3,00,000 to Mr. B and Mr. B accepts a bill of exchange for the same amount. Mr. A endorses the bill to his supplier, Mr. C. If Mr. B dishonours the bill on the due date, the entry to be passed in Mr. A’s books (ignoring noting charges) would be:
1
A. Mr. B’s A/c Dr Rs. 3,00,000
To Bills Payable A/c Rs. 3,00,000
2
Mr. C’s A/c Dr Rs. 3,00,000
To Bills Receivable A/c Rs. 3,00,000
3
Mr. B’s A/c Dr Rs. 3,00,000
To Mr. C’s A/c Rs. 3,00,000
4
Bills Receivable A/c Dr Rs. 3,00,000
To Mr. B’s A/c Rs. 3,00,000