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Test: Bill Of Exchange - 1


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10 Questions MCQ Test Accountancy Class 11 | Test: Bill Of Exchange - 1

Test: Bill Of Exchange - 1 for Commerce 2022 is part of Accountancy Class 11 preparation. The Test: Bill Of Exchange - 1 questions and answers have been prepared according to the Commerce exam syllabus.The Test: Bill Of Exchange - 1 MCQs are made for Commerce 2022 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Bill Of Exchange - 1 below.
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Test: Bill Of Exchange - 1 - Question 1

Q.  Bill of Exchange has parties :

Detailed Solution for Test: Bill Of Exchange - 1 - Question 1

A bill of exchange consist of three parties namely:
i) Drawer 
ii) Drawee
iii) Payee.

Test: Bill Of Exchange - 1 - Question 2

The party which is ordered to pay the amount of bill of exchange is called :

Detailed Solution for Test: Bill Of Exchange - 1 - Question 2

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. He becomes an acceptor when he indicates his willingness to pay the bill.

Test: Bill Of Exchange - 1 - Question 3

The party which is entitled to receive the payment of bill of exchange is known as :

Detailed Solution for Test: Bill Of Exchange - 1 - Question 3
  • A person to whom money is paid or is to be paid, especially the person to whom a cheque is made payable. A payee is a party in an exchange who receives payment. The payee is paid by cash, check, or another transfer medium by a payer.
  • The drawee is the party that pays the sum specified by the bill of exchange
  • The drawer is the party that obliges the drawee to pay the payee. The drawer and the payee are the same entity unless the drawer transfers the bill of exchange to a third-party payee.

So, payee is the correct option.

Test: Bill Of Exchange - 1 - Question 4

Due date of a bill of exchange drawn on 30th January, 2011 for one month will be :

Detailed Solution for Test: Bill Of Exchange - 1 - Question 4

Due date of a bill is only after the given period (in this case one month ) plus three days of grace . So the bill will be paid only after 1 month and 3 days i.e. on 3rd march.

Test: Bill Of Exchange - 1 - Question 5

The promissory note should be signed by

Detailed Solution for Test: Bill Of Exchange - 1 - Question 5

Promissory Notes: A negotiable instrument is a document in writing. It is signed by a certain person who promises to pay another person a fixed sum of money on a fixed date.

Test: Bill Of Exchange - 1 - Question 6

On dishonor of a discounted bill who does the bank look for payment?

Detailed Solution for Test: Bill Of Exchange - 1 - Question 6

Drawer (the person who had received B/R) because he had discounted the bill from the bank and now he's liable for it's dishonour. But later he can claim this amount from drawee.

Test: Bill Of Exchange - 1 - Question 7

While calculating the due date of the bill, how many days are added to the period of the bill :

Detailed Solution for Test: Bill Of Exchange - 1 - Question 7

3 days of grace are added to the period of bill while calculating the due date of the bill.

Test: Bill Of Exchange - 1 - Question 8

Encashing the bill before the date of its maturity is called :

Detailed Solution for Test: Bill Of Exchange - 1 - Question 8

When we encash a bill before it's maturity, it's generally discounted with bank, bank charges some discounting charges and thus the process is known as discounting of bill.

Test: Bill Of Exchange - 1 - Question 9

A bill of exchange renewed generally at the request of

Detailed Solution for Test: Bill Of Exchange - 1 - Question 9

When drawer want their money and drawee is not in the position to pay his money, then he wants some time to pay his money and so he requests to make a new bill to drawer.

Test: Bill Of Exchange - 1 - Question 10

A bill of exchange can not be

Detailed Solution for Test: Bill Of Exchange - 1 - Question 10

A bill of exchange is a document used in transactions that orders the payer to pay a certain amount of money to the payee. It is a guarantee of payment on demand or on a specified date, and it cannot be refused or cancelled, like a check.

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