Multiple choice

A dishonour of a bill receivable (retained) is recorded in

  1. bills receivable book

  2. journal proper

  3. three column cash book

  4. none of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

When a bill receivable that was retained (not discounted with the bank) is dishonoured, there is no specialized book to record this event. The dishonour requires reversing the original bill entry and recording the debt recovery process, which is done in the journal proper (general journal). The bills receivable book only records initial bill creation, not subsequent dishonours.

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