Cpt foundation

It is assumed that Interest is also payable with original amount in extended period.

In the books of kartik

On sale

Rajesh A/c Dr.         2 Lakhs

       To Sales A/c             2 Lakhs

on 3 months bill acceptance

Bill receivable A/c Dr.    2 Lakhs

       To Rajesh A/c              2 Lakhs

On cancellation the bill for renewal 

 Rajesh A/c Dr.         2 Lakhs

      To Bill receivable A/c     2 Lakhs

For interest 

Rajesh A/c Dr.         6000

    To Interest A/c         6000

New acceptance

Bill receivable A/c Dr.    2.06 Lakhs

       To Rajesh A/c              2.06 Lakhs

In the books of Rajesh

Purchase A/c Dr.      2 Lakhs

    To Kartik A/c                 2 Lakhs

on 3 months bill acceptance

Kartik A/c Dr.    2 Lakhs

       To Bill payable A/c              2 Lakhs

On cancellation the bill for renewal 

 Bill payable A/c Dr.         2 Lakhs

      To Kartik A/c                     2 Lakhs

For interest 

Interest A/c Dr.         6000

    To Kartik A/c         6000

New acceptance

Kartik A/c  Dr.    2.06 Lakhs

       To Bill payable A/c             2.06 Lakhs