Explain the journal entries of bills receivable , payable , bills sent for collection ? Also explain with the 3 golden rules rules of accounting
Rules as per Traditional Classification of Accounts
For Real Accounts (Assets- Tangibles and Intangibles): Debit what comes in and Credit what goes Out.
For Personal Accounts (Debtors, Creditors): Debit the Receiver and Credit the Giver.
For Nominal Accounts (Expenses and Incomes): Debit all expenses and losses, Credit all incomes and gains.
Hope this clarifies your doubt!
1. Bills receivable a/c dr to debtor a/c 2. creditor a/cdr to bills payable a/c 3. bills sent for collection a/c dr to bills receivable a/c
Golden rules are:- 1. All expenses and losses are debited and all income and gains are credited 2. Debit what comes in,credit what goes out 3. debit the receiver and credit the giver