Ramesh sold goods to Ganesh on credit for Rs. 20,000. Ganesh accepted a bill of Rs. 20,000 for 3 months, drawn by Ramesh on the same date.
On the due date Ganesh dishonoured his acceptance. Then Ganesh approached Ramesh and requested for renewal of the bill.
Ramesh agreed on the condition that Ganesh should pay Rs. 10,000 in cash and accept a new bill for 2 months for the balance amount plus interest Rs. 200.
The new bill was drawn by Ramesh and accepted by Ganesh.
However one month before the due date Ganesh retired his acceptance by paying Rs. 9,900.
Pass necessary Journal Entries in the books of Ramesh.