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Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by?
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Aas discounted at 3 months pill at the rate 10% per annum from bank an...
Understanding the Discounted Bill Process
When a bill is discounted at a bank, the bank provides an immediate cash credit against the future receivable amount, deducting interest and any applicable charges.
Steps in the Discounting Process
- Principal Amount: The amount credited on the due date is ₹11,700. This is the amount the bank will pay to the bill holder after deducting the interest and charges.
- Rate of Discount: The bank discounts the bill at a rate of 10% per annum. For a 3-month period, the interest needs to be calculated based on this rate.
- Interest Calculation: The interest for 3 months (1/4 of a year) is calculated as follows:
- Interest = Principal × Rate × Time
- Interest = ₹11,700 × 10% × (3/12) = ₹292.50
- Total Amount Before Charges: The total amount the bank should debit the account for the discounted bill is:
- Total Amount = Credited Amount + Interest
- Total Amount = ₹11,700 + ₹292.50 = ₹11,992.50
Noting Charges
- Deducting Noting Charges: The bank charges ₹20 for honouring and noting the bill.
- Final Amount Debited: Thus, the total amount debited from the account will be:
- Final Amount = Total Amount + Noting Charges
- Final Amount = ₹11,992.50 + ₹20 = ₹12,012.50
Conclusion
In summary, the bank will debit the account by ₹12,012.50, which includes the credited amount, the interest for the 3-month period, and the noting charges. This reflects the total cost incurred by the client for availing the discounting facility.
When a bill is discounted at a bank, the bank provides an immediate cash credit against the future receivable amount, deducting interest and any applicable charges.
Steps in the Discounting Process
- Principal Amount: The amount credited on the due date is ₹11,700. This is the amount the bank will pay to the bill holder after deducting the interest and charges.
- Rate of Discount: The bank discounts the bill at a rate of 10% per annum. For a 3-month period, the interest needs to be calculated based on this rate.
- Interest Calculation: The interest for 3 months (1/4 of a year) is calculated as follows:
- Interest = Principal × Rate × Time
- Interest = ₹11,700 × 10% × (3/12) = ₹292.50
- Total Amount Before Charges: The total amount the bank should debit the account for the discounted bill is:
- Total Amount = Credited Amount + Interest
- Total Amount = ₹11,700 + ₹292.50 = ₹11,992.50
Noting Charges
- Deducting Noting Charges: The bank charges ₹20 for honouring and noting the bill.
- Final Amount Debited: Thus, the total amount debited from the account will be:
- Final Amount = Total Amount + Noting Charges
- Final Amount = ₹11,992.50 + ₹20 = ₹12,012.50
Conclusion
In summary, the bank will debit the account by ₹12,012.50, which includes the credited amount, the interest for the 3-month period, and the noting charges. This reflects the total cost incurred by the client for availing the discounting facility.
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Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by?
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Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by?.
Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Aas discounted at 3 months pill at the rate 10% per annum from bank and given credit of rupees 11700 on due date bill is this honour and noting charges of rupees 20 paid by bank bank world debit is account by?.
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