On 1.1.2015, A sells goods to B for ~ 10,000 and draws a bill on him for the same amount for 3 months. B accepts the bill and returns it to A. One month before the due date, B requests A to cancel the bill. Instead, he wants to pay ~ 3,000 immediately as part payment and to accept a fresh bill for the balance plus interest for a further period of 2 months from the due date of the original bill. A agrees to the proposal. The new bill is honoured on the due date. The rate of interest is 12% p.a. Pass Journal Entries in the books of A.
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