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Class 11
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explain briefly the purpose and advantages of main...

Question:
Explain briefly the purpose and advantages of maintaining of a Bills Receivable Book.

Answer:

A Bills Receivable Book is designed as a summary of information regarding a duly accepted bill received by a drawer. It contains almost all the details of the bill like bill date, acceptor’s name, amount, term place of payment etc for future reference.

The advantage of preparing the Bills Receivable Book is that we get all the information at a glance. Moreover we can get an overall idea about our Debtors and keep our collection system smooth and up to date. A Bill Receivable Book contains a number of transaction related to the bills, e.g., related to bills discounted, endorsement, retirement, renewal etc.

The bills receivable book, like any other subsidiary book, is totalled periodically. This total is debited to the ‘Bills Receivable Account’ whereas the account of every individual debtor whom the bills received is credited in the ledger. The Bills Receivable Account is the account of an asset and would always have a debt balance.

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Mr. Sunrise started a business for buying and selling of stationery with ₹ 5,00,000 as an initial investment. Of which he paid ₹ 1,00,000 for furniture, ₹ 2,00,000 for buying stationery items. He employed a sales person and clerk. At the end of the month he paid ₹ 5,000 as their salaries. Out of the stationery bought he sold some stationery for ₹ 1,50,000 for cash and some other stationery for ₹ 1,00,000 on credit basis to Mr. Ravi. Subsequently, he bought stationery items of ₹ 1,50,000 from Mr. Peace. In the first week of next month there was a fire accident and he lost ₹ 30,000 worth of stationery. A part of the machinery, which cost ₹ 40,000, was sold for ₹ 45,000.

From the above, answer the following :
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7. What is the loss he incurred?
8. Who is the debtor? What is the amount receivable from him?
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Question:
Explain briefly the purpose and advantages of maintaining of a Bills Receivable Book.

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Question: Explain briefly the purpose and advantages of maintaining of a Bills Receivable Book.

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Question:
Explain briefly the purpose and advantages of maintaining of a Bills Receivable Book.