Bills Payable Book:
Learning Objectives:
-
Define and explain bills payable book.
-
Prepare a bills payable book and post into
ledger.
Definition and Explanation:
Bills payable book is used to record
bill accepted by us. When a bill drawn by our creditor is accepted
particulars of the same are recorded in this book.
Posting:
In the ledger, the account of each person
whose bill has been accepted is debited with the amount of the bill. The
monthly total of the bills accepted is credited to the bills payable account
ledger.
Format of Bills Receivable Book:
The following is the ruling and format of
bills payable book:
(1) Bills Payable Book
|
Date |
To whom given |
Drawer |
Payee |
Where payable |
Term |
Due date |
L.F. |
Amount |
Remarks |
| |
|
|
|
|
|
|
|
|
|
(2) Bills Payable Book
|
Date |
To whom given |
Term |
Due date |
L.F. |
Amount |
| |
|
|
|
|
|
Example:
From the following transactions of a trader
prepare the bills payable book and post it into ledger:-
| 1991 |
|
|
January 5 |
Accepted a bill at 3 m/d for $200 drawn by Rahmat & Co. |
| "
20 |
gave acceptance at 2 m/d for $500 to Kamal. |
|
" 30 |
Acceptance at 1 m/d for $ 500 given to Feroz & Co. |
Solution:
Bills Payable Book
|
Date |
Particulars |
Term |
Due Date |
L.F. |
Amount |
|
1991
Jan. 5
" 20
" 30
|
Rahmat & Co.
Kamal
Feroz & Co.
|
3 m/d
2 m/d
1 m/d
|
April 8
March 23
" 30
|
|
$
200
500
500
|
|
1,200 |
Bills Payable Account
|
|
|
|
1991
Jan. 31 |
By Sundries as per B/p Book |
$
1,200 |
Rahmat & Co.
|
1991
Jan. 5 |
By Bill Payable |
$
200 |
|
|
|
Kamal
|
1991
Jan. 20 |
By Bill Payable |
$
500 |
|
|
|
Feroz & Co.
|
1991
Jan. 31 |
By Bill Payable |
$
500 |
|
|
|
|
