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Bills of Exchange Test 21

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Bills of Exchange Test 21
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Weekly Quiz Competition
  • Question 1
    1 / -0
    Noting is necessary in case of __________ of bill.
    Solution
    $$\Rightarrow$$  Noting a bill -- When a bill (draft or promissory note) has been presented for acceptance or payment and has been dishonored a note to that effect is indorsed on the bill, after which it may be formally protested.

    $$\Rightarrow$$  As per section 99 of the NI Act, 1881, When a promissory note or bill of exchange ha s been dishonoured by non-acceptance or non-payment, the holder may cause such dishonour to be noted by a notary public upon the instrument, or upon a paper attached thereto, or partly upon each.
    $$\therefore$$   Noting is necessary in case of Dishonour of bill

  • Question 2
    1 / -0
    If Mr. Z draws the bill of exchange for Rs $$75,000$$ on Mr. N. This transaction will be recorded by Mr.Z in ________and by Mr. N in ________.
  • Question 3
    1 / -0
    ______ is a person to whom the amount on a bill is payable.
    Solution
     In simple words, it is always drawn by the creditor on the debtor.   The person who draws is known as the 'drawer' and the person on whom it is drawn is known as the 'drawee' or 'acceptor'. The person to whom the amount of money is payable to is known as the 'payee'
  • Question 4
    1 / -0
    The following steps are normally taken in an import trade:
    1. Indent and letter of credit 
    2. Ship's report
    3. Delivery and customs formalities
    4. Exchange and bills of exchange 
    Correct sequence of these steps is
  • Question 5
    1 / -0
    On $$18.2.2019$$ A draws a bill on $$B$$ for $$Rs. 1,25,000$$. $$B$$ accepted the bill on $$21.2.2019$$. The bill is drawn for $$30$$ days after sight. The maturity date of the bill will be : ________.
    Solution
    If bill is drawn using words after sight then calculation will start from the date of acceptance. $$30$$ days from $$21.2.2019$$ comes to $$23.3.2019 + 3$$ grace days; hence date of maturity $$26.3.2019$$.
  • Question 6
    1 / -0
    Which of the given below sentence is proper as to considered to be written in negotiable instruments _____________________.
    Solution
    A "promissory note" is an instrument in writing (not being a bank-note or a currency-note) containing an unconditional undertaking signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument.
  • Question 7
    1 / -0

    Mr.Ajay draws a bill on Mr.Vijay on 1st August, 2018 for Rs. 50,000 for 3 months payable after sight. The bill was accepted on 8th August, 2018. 11th November was a sudden Holiday. Calculate due date in the above case?

    Solution

    If the due date falls on a day which is a sudden holiday, the due date shall be the following business day. In this case the due date will be: 

    Date of acceptance of the bill: 8th August, 2018
    Period:                                     3 months
    Maturity Date:                          8th November, 2018
    Grace Days:                             3 Days
    Due Date:                               12th November,2018 

  • Question 8
    1 / -0
    A Promissory Note or Bill of Exchange can be made payable ___________.
  • Question 9
    1 / -0
    What is a bill of exchange?
    Solution
    Bill of Exchange can be understood as a written negotiable instrument, that carries an unconditional order to pay a specified sum of money to a designated person or the holder of the instrument, as directed in the instrument by the maker. The bill of exchange is either payable on demand, or after a specified term.
  • Question 10
    1 / -0
    On 1st January, 2018 Mr.Ram draws a bill on Mr.Ravan for Rs. 20,000 for 3 months payable after date. Calculate due date in this case.
    Solution
    In case of a Bills Payable after date, the legal due date is calculated from the date of drawing of the bill. In this case the due date will be:
    Date of Drawing bill: 1st January, 2018
    Period (Months):       3 Months
    Maturity Date:           1st April, 2018
    Days of Grace:          3 days 
    Due Date:                  4th April, 2018
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