Bill of Exchange Test

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Bill of Exchange Test - 43

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Weekly Quiz Competition

Question 1
1 / -0

Which of the following is not correct ?

A
Discount on bills discounted is treated as financial expense and is debited to P and L Account.

B
For unsold stock lying with the consignee, no entry is made in his books.

C
Loss of stock is said to be abnormal when such loss is natural and is due to inherent characteristics of the commodities.

D
The abnormal loss on consignment is credited to Consignment Account.
Question 2
1 / -0

If the bill is drawn on 14th May and the duration of bill is 90days, the due date of bill will be ________________.

A
14th August

B
15th August

C
16th August

D
17th August

Solution

Days of Bill
Grace Days 90
3
Total Days
Less: Remaining days 93

17
May (31 -14)

June

July

Aug 76
30
46
31
15
Being Independence Days Due will be considered on 14th August.
Question 3
1 / -0

If the bill falls due for payment on 15th August, then the payment must be made on ____________ January.

A
14th August

B
15th August

C
!6th August

D
18th August

Solution

When due date of Bill Falls on a Public Holiday it is paid at its Preceding Working Day.
therefore 15th Aug Being A public holiday due to Independence Day of India,
Due Date considered for payment is 14th Aug.
Question 4
1 / -0

A one month bill drawn and accepted on 31st January, will become due on ___________.

A
28th Feb

B
29th Feb

C
1st March

D
3rd March

Solution

Legal Due Date = Date of Bill + Period of Bill + 3 grace Days
Therefore Legal Due Date = 31st jan + 1 months + 3days
= 28feb + 3days
= 3rd March
Question 5
1 / -0

If tenure of bill is 90days ,accepted on 23rd Dec 1991 its due date will be _____________.

A
23rd March 1992

B
24th March 1992

C
25th March 1992

D
26th March 1992

Solution

Days of Bill
Grace Days 90
3
Total Days
Less: Remaining days 93

8
Dec 1991(31-23)

Jan-92

Feb-92

Mar-92 85
31
54
29
25

29 days being a Leap Year.
Question 6
1 / -0

At the time of retirement of a bill, the accounts to be credited are:

A
Bills Payable and Bank.

B
Bills Receivable and Bank.

C
Bank and Discount.

D
Bills Payable and Discount.
Question 7
1 / -0

Writing a person's name on the face or the back of the bill for transferring his right to another.

A
Endorsement of bill

B
Discounting of bill

C
Dishonouring of bill

D
Renewal of bill

Solution

The process of transferring bill from one person to another by signing on the back of the bill in order to settle debts other than cash is known as Endorsement of the The Bill.
Question 8
1 / -0

If the bill of exchange of two month's duration is accepted on 13th June its maturity date will be ____________.

A
13th August

B
14th August

C
15th August

D
16th August

Solution

Legal Due Date = Date of Bill + Period of Bill + 3 grace Days
Therefore Legal Due Date = 13th june + 2 months + 3days
= 13th Aug + 3days
=16th Aug
Question 9
1 / -0

Which of the following is not a correct statement ?

A
A bill given to a creditor is called Bill Payable

B
Del-Credere commission is normally calculated o total sales

C
Discount at the time of retirement of a Bill is a given for the drawee

D
The owner of a shop feels that he has made a loss due to closing stock being zero

Solution
Question 10
1 / -0

Which of these statements is not true about a Promissory note?

A
No notice of dishonour of Promissory note is required

B
Dishonour of Promissory note does not required noting or protest

C
A Promissory note cannot be made payable to the maker himself

D
Promissory note cannot be made payable to the bearer
Solution
Notice of dishonor is a notice given by the holder of a bill of exchange or promissory note, to a drawer or indorser showing that acceptance or payment has been refused. Notice of dishonor is also known as certificate of protest or certificate of dishonor.
Protest for dishonour: Foreign bill of exchange must be protested for dishonour when such protest is required to be made by the law of the country where they are drawn, but no such protest is needed in the case of a promissory note.
A promissory note cannot be made payable the maker himself, while in a bill of exchange to the drawer and payee or drawee and payee may be same person.
A promissory note cannot be made payable to the bearer, no matter whether it is payable on demand or after a certain time.

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Days of Bill Grace Days	90 3
Total Days Less: Remaining days	93 17
May (31 -14)	93 17
June July Aug	76 30
	46 31
	15

Bill of Exchange Test - 43

Result

Bill of Exchange Test - 43

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SHARING IS CARING

Question 1

Discount on bills discounted is treated as financial expense and is debited to P and L Account.

For unsold stock lying with the consignee, no entry is made in his books.

Loss of stock is said to be abnormal when such loss is natural and is due to inherent characteristics of the commodities.

The abnormal loss on consignment is credited to Consignment Account.

Question 2

14th August

15th August

16th August

17th August

Solution

Question 3

14th August

15th August

!6th August

18th August

Solution

Question 4

28th Feb

29th Feb

1st March

3rd March

Solution

Question 5

23rd March 1992

24th March 1992

25th March 1992

26th March 1992

Solution

Question 6

Bills Payable and Bank.

Bills Receivable and Bank.

Bank and Discount.

Bills Payable and Discount.

Question 7

Endorsement of bill

Discounting of bill

Dishonouring of bill

Renewal of bill

Solution

Question 8

13th August

14th August

15th August

16th August

Solution

Question 9

A bill given to a creditor is called Bill Payable

Del-Credere commission is normally calculated o total sales

Discount at the time of retirement of a Bill is a given for the drawee

The owner of a shop feels that he has made a loss due to closing stock being zero

Solution

Question 10

No notice of dishonour of Promissory note is required

Dishonour of Promissory note does not required noting or protest

A Promissory note cannot be made payable to the maker himself

Promissory note cannot be made payable to the bearer

Solution

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