Bills of Exchange Account - Bills of Exchange

Under what circumstances the drawer and the payee is the same person, with reference to a bill of exchange?

Sohan draws a 40 days bill on Rohan on 20th January, 2010. The bill matures on

If a bill is accepted and the payment is made before the due date of maturity, the difference between the paid amount and the bill amount will be called as ..........

A draws a bill on B for ₹ 30,000. A endorses it to C in settlement of ₹ 35,000 at 2% discount with the help of B’s acceptance and the balance in cash. If the bill is dishonoured on the due date, by what amount will C debit A?

Bill is drawn on 20th January, 2010 for 2 months. After sight date of acceptance is 29th January, 2010. The maturity date of bill will be:

At the time of renewal of a bill, interest account is credited in the books of the drawee.

Bill of exchange is a conditional order to pay.

A promissory note has only two parties, the drawer and the payee.

There are two parties in a bill of exchange.

Accomodation bills are drawn without consideration.

The person in whose favour an endorsement is made is called ____________.

A Bill of Exchange has ____________ parties.

When a bill of exchange is not paid on its due date, it is called ____________.

State the account to bre debites or credited in the following situation:
Books of Drawer:-
When noting charges are paid by the bank at the time of dishonour of the bill, the drawee credits ____________ account.

Three days added for ascertaining the date of maturity of bill of exchange are called ____________.

What is discounting of the bill of exchange?

Name any two types of commonly used negotiable instruments.

Distinguish between Bill of Exchange and Promissory Note on the basis of acceptance.

What is a promissory note?

What is the meaning of ‘rebate' with reference to Bill of Exchange?

What are the different uses available to a holder for dealing with bills receivable?

On Feb. 6, 2017 A sold goods for ₹ 1,00,000 to B. B paid 40% immediately on which Aallowed a cash discount of ₹ 500. For the balance A drew a bill on B payable after 30 days. Due date of bill was a public holiday and the bill was met as per the provisions of Negotiable Instrument Act. Journalise the above transactions in the books of A and B.

What is meant by 'Retiring a bill under rebate'?

Asha sold goods worth ₹ 19,000 to Nisha on March 2, 2016. ₹ 4,000 were paid by Nisha immediately and for the balance she accepted a bill of exchange drawn upon her by Asha payable after three months. Asha discounted the bill immediately with her bank @ 10% p.a. On the due date Nisha dishonoured the bill and the bank paid ₹ 30 as noting charges.
On 5th June, Nisha paid ₹ 3,030 (including noting charges) in cash and accepted a new bill at one month for the amount due to Asha together with interest @ 15% p.a. Record the necessary journal entries in the books of Asha and Nisha.

Calculate the due dates of the bills in the following cases:

	Date of the Bills	Period
I.	1st February, 2017	2 months
II.	31st January, 2017	3 months
III.	30th September, 2017	2 months
IV.	30th September, 2017	3 months
V.	29th December, 2017	2 months
VI.	31st December, 2017	2 months
VII.	15th July, 2017	30 days
VIII.	27th January, 2016	1 month

Explain any three of the following:

1. Retiring of a bill of exchange.
2. Discounting of a bill of exchange.
3. Bill sent to bank for collection.
4. Noting Charges.

Give a definition of Bill of Exchange and give its four characteristics.

Distinguish between an accomodation bill and a trade bill.

Fill up the missing information in the following journal entries:

On 10th January, 2017, A sells goods to B for ₹ 12,000. On that date, B accepted a bill drawn upon him by A at two months for ₹ 12,000. A retains the bill till due date and on due date sends the bill to the Banker for collection. In due course, A receives the information from the Bank that the bill has been duly met.
Pass Journal Entries in the books of A and B.

X sold goods to Y on 1.3.2017 for ₹ 12,000 and drew upon Y a bill of exchange for the same amount payable after two months. X immediately discounted the bill with his bank at 9% p.a. The maturity date of the bill was a non business day (holiday), therefore, X had to present the bill as per the provisions of the Indian Instruments Act, 1881. The bill was dishonoured by Y and X paid ₹ 45 as noting charges. Y settled the claim of X five days after the dishonour of the bill by a cheque which included interest @ 12% for the term of the bill.
Journalise the above transactions in the books of X and Y and prepare Y's account in the books of X and X's account in the books of Y.

Fill up the missing information in the following journal entries:

On Feb. 01, 2017, Mohan sold goods worth ₹ 25,000 to Naresh and drew upon him a bill payable after 90 days. Naresh accepted the bill and Mohan endorsed the bill immediately in favour of his creditor Raja in full settlement of his account of ₹ 25,300. One week before the maturity of the bill Naresh requested Mohan to cancel the bill and draw upon him a new bill including interest of ₹ 400. Mohan agreed to it. Mohan immediately took the bill from Raja by making the payment to him and then drew upon Naresh a new bill for 30 days which was duly met by Naresh on due date.
Pass necessary entries in the books of Mohan.

On 21st Sept. 2017, Radhika sold goods for ₹ 2,00,000 to Parvati and drew upon later a bill for the same amount payable after 3 months. The bill was accepted by Parvati, Radhika discounted the bill from bank at a discount of 15% p.a. on 21st Oct., 2017. On maturity, the bill was dishonoured. Parvati agreed to pay ₹ 1,20,000 in cash including ₹ 3,000 interest and accepted a new bill for 3 months. The new bill was endorsed to Gayatri in full settlement of his account ₹ 85,000. It was duly met on maturity. Pass entries in the books of Radhika.

On 17th April, 2016, X sold goods to Y for ₹ 80,000 and draws a bill for 2 months upon Y for the amount due. Y accepted the bill and returned it to X. On due date the bill became dishonoured and X paid ₹ 400 as Noting Charges. Fifteen days later Y pays the amount due to X. Pass Journal entries in the books of both the parties.