Bill of Exchange Test

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Bill of Exchange Test - 11

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Weekly Quiz Competition

Question 1
1 / -0

If the drawee pay the bill before its maturity date it is called ___________.

A
retirement

B
pre-payment

C
postponement

D
dishonor
Question 2
1 / -0

The party which is ordered to pay the amount is known as __________.

A
Payee

B
Drawer

C
Drawee

D
Endorsee

Solution

The person who draws the bill is called the drawer. He gives the order to pay money to third party. The party upon whom the bill is drawn is called the drawee. He is the person to whom the bill is addressed and who is ordered to pay.
Question 3
1 / -0

The true discount on a bill due $$9$$ months hence at $$16$$% per annum is $$Rs. 189$$. The amount of the bill is:

A
$$Rs. 1386$$

B
$$Rs. 1764$$

C
$$Rs. 1575$$

D
$$Rs. 2268$$

Solution

Let P.W. be $$Rs. x$$.
Then, S.I. on $$Rs. x$$ at $$16$$% for $$9$$ months $$= Rs. 189$$.
$$\therefore x\times 16\times \dfrac {9}{12} \times \dfrac {1}{100} = 189$$ or $$x = 1575$$.
$$\therefore P.W. = Rs. 1575$$.
$$\therefore$$ Sum due $$= P.W. + T.D. = Rs. (1575 +189) = Rs. 1764$$.
Question 4
1 / -0

Which of the following statements is true?

A
Creditors can draw a bill on debtors

B
Debtors can draw a bill on creditors

C
Bank will draw a bill on customer at the time of overdraft

D
One can draw the bill on another under any circumstance.
Question 5
1 / -0

Rebate is calculated for __________ time before the due date.

A
unexpired

B
expired

C
future

D
none
Question 6
1 / -0

Which account is debited by a drawee of a bill of exchange on its endorsement?

A
Bills Payable

B
Bills Receivable

C
Drawer

D
None of the above
Question 7
1 / -0

When bill is accepted by the acceptor ________.

A
Bill Payable A/c Dr

To Drawer A/c

B
Bill Payable A/c Dr

To Drawee A/c

C
Bill Receivable A/c Dr

To Drawer A/c

D
None
Question 8
1 / -0

The rebate on a bill shows that it has been ____________.

A
paid before the date of maturity

B
paid after the date of maturity

C
been dishonoured

D
endorsed
Question 9
1 / -0

The period intervening between the date on which a bill is drawn and the date on which it becomes due for payment is called

A
Due date

B
Term of Bill

C
Days of Grace.

D
Date of Maturity

Solution

The period intervening between the date on which a bill is drawn and the date on which it becomes due for payment is called Term of Bill. It denotes tenure of the bill i.e time period.
Question 10
1 / -0

Sum due or face value $$(A)$$ can be calculated by

A
$$ A= \dfrac{\text{Banker's Discount} -\text{True Discount}}{\text{Banker's Discount}\times\text{True Discount}} $$

B
$$ A= \dfrac{\text{Banker's Discount} + \text{True Discount}}{\text{Banker's Discount}-\text{True Discount}} $$

C
$$ A= \dfrac{\text{Banker's Discount} - \text{True Discount}}{\text{Banker's Discount} + \text{True Discount}} $$

D
$$ A= \dfrac{\text{Banker's Discount} \times \text{True Discount}}{\text{Banker's Discount}-\text{True Discount}} $$

Solution

Sum due or face vlue (A) can be calculated by the formula
$$A=\dfrac { Bankers\quad Discount\times True\quad discount }{ Bankers\quad Discount-True\quad discount } $$

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Re-Attempt Weekly Quiz Competition

Bill of Exchange Test - 11

Result

Bill of Exchange Test - 11

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Rank

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SHARING IS CARING

Question 1

retirement

pre-payment

postponement

dishonor

Question 2

Payee

Drawer

Drawee

Endorsee

Solution

Question 3

$$Rs. 1386$$

$$Rs. 1764$$

$$Rs. 1575$$

$$Rs. 2268$$

Solution

Question 4

Creditors can draw a bill on debtors

Debtors can draw a bill on creditors

Bank will draw a bill on customer at the time of overdraft

One can draw the bill on another under any circumstance.

Question 5

unexpired

expired

future

none

Question 6

Bills Payable

Bills Receivable

Drawer

None of the above

Question 7

Bill Payable A/c DrTo Drawer A/c

Bill Payable A/c DrTo Drawee A/c

Bill Receivable A/c DrTo Drawer A/c

None

Question 8

paid before the date of maturity

paid after the date of maturity

been dishonoured

endorsed

Question 9

Due date

Term of Bill

Days of Grace.

Date of Maturity

Solution

Question 10

$$ A= \dfrac{\text{Banker's Discount} -\text{True Discount}}{\text{Banker's Discount}\times\text{True Discount}} $$

$$ A= \dfrac{\text{Banker's Discount} + \text{True Discount}}{\text{Banker's Discount}-\text{True Discount}} $$

$$ A= \dfrac{\text{Banker's Discount} - \text{True Discount}}{\text{Banker's Discount} + \text{True Discount}} $$

$$ A= \dfrac{\text{Banker's Discount} \times \text{True Discount}}{\text{Banker's Discount}-\text{True Discount}} $$

Solution

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Bill Payable A/c Dr

To Drawer A/c

Bill Payable A/c Dr

To Drawee A/c

Bill Receivable A/c Dr

To Drawer A/c