alleryBill renewed at request of drawee. The drawer's first entry credits:
ABills Receivable old account
BBank account in books
CCash account in books
DDrawee account directly
Answer & Solution
Correct answer: A. Bills Receivable old account
1. Old bill is cancelled: Drawee A/c Dr; To Bills Receivable.
2. Interest may be added to drawee account.
3. New bill is then drawn: Bills Receivable Dr; To Drawee A/c.
_Source: ICAI BoS Foundation Paper 1, Ch 6 "Bills of Exchange", §7 renewal_
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