Tag: book keeping and accountancy

Questions Related to book keeping and accountancy

A bill drawn on 25.11.2013 as payable 60 days after date was accepted on 26.11.2013. The date of maturity of this bill will be________.

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange
    1. 1 . 2014
    1. 1. 2014
    1. 1 . 2014

  4. None of these.

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Correct Option: C

The term of a "bill after sight" commences ______.

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. From the date of acceptance or presentation which ever is earlier.

  2. From the date of drawing a bill.

  3. From the date of receipt of the accepted bill.

  4. From the date of receipt of drawn bill.

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Correct Option: A
Explanation:

Option A is correct.

 "Bill after Sight" term of bill starts from the date of acceptance. When no time for payment is mentioned in the bill of exchange and the bill is payable whenever it is presented to the drawee for the payment, such bills are know as "Bill at sight" or "Bill on Demand".

When the acceptor of an instrument is also a drawer, notice of dishonour is ________________.

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. Necessary(section 98A)

  2. Not necessary (Section 98(e))

  3. Not always necessary but under certain circumstances mentioned in section 98A of the Act, it is a must

  4. None of the above

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Correct Option: B

In case of dishonour of a discounted bill, noting charges are initially paid by __________.

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. drawer.

  2. drawee.

  3. banker.

  4. None of these.

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Correct Option: C

From the following information, find out who can draw the bill if Mr A sold goods to B.

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. A will draw a bill on B

  2. B will draw a bill on A

  3. None

  4. Third party will draw a bill on A (a)

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Correct Option: A
Explanation:

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.

Dishonour by non-acceptance takes place _________________.

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. When the bill is properly presented for acceptance, except where presentment is excused, but the drawee makes the default in accepting it.

  2. When the bill is properly presented for acceptance, except where presentment is excused, but the drawee makes the default in paying it.

  3. When the bill is properly presented for payment, except where presentment is excused, but the drawee fails to accept it.

  4. None of the above

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Correct Option: C

Discount charges of Rs.1,000 on discounting a Bill Receivable accepted by consignee are debited to:

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. Consignor's Account

  2. Consignee's Account

  3. Consignment Account

  4. Profit & Loss Account

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Correct Option: D
Explanation:

Any expense borne by the agent personally, such expenses will not be debited to consignment A/c. Consignor will not make any entry for such expenses. These expenses will be debited to profit and loss account in the books of consignee.

A bill of 1,50,000 was discounted by A with the banker of 1,45,500. At maturity, the bill returned dishonoured, nothing charges 200. How much amount will the bank deduct from A's bank balance at the time of such dishonour?

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. 1,45,500

  2. 1,45,700

  3. 1,50,000

  4. 1,50,200

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Correct Option: D

X accepted a bill drawn by Y who endorsed the bill to Z. One the due date, the bill is dishonored. To record the dishonor of the bill in the books of Y, Which of the following accounts should be credited?

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. X

  2. Bills Receivable account.

  3. Z

  4. Bills payable account.

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Correct Option: C

X draws a bill on Y for 1,50,000 for 3 months on 1.1.13. The bill is discounted with the banker at a charge of  4,500. At maturity the bill return dishonored. In the books of X, for dishonor, the bank account will be credited by:

book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

  1. 1,45,500

  2. 1,50,000

  3. 1,54,500

  4. None of these

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Correct Option: B