Tag: bills of exchange and promissory note

Questions Related to bills of exchange and promissory note

Whenever the amounts are collected or paid by the banks on some specific dates as per the standing instructions by the account holder, an intimation for the same is sent by the bank. Such intimation is known as __________. 

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. Bank statement

  2. Bank advice

  3. Pass book

  4. None of these

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Correct Option: B
Explanation:

A bank advice is a notice that the bank gives to the customer when a transaction takes place. Whenever any amount is deducted or added in the bank account the bank intimates the customer about the same. 

A type of cheque where the holder is paid the amount, across the counter of bank.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. Cross cheque

  2. Bearer cheque

  3. Payee cheque

  4. None of the above

Show answer
Correct Option: B
Explanation:

An open cheque is the bearer cheque. It is payable over the counter on presentment by the payee to the paying banker. While a crossed cheque is not payable over the counter but shall be collected only through a banker. 

A cheque in which bank makes cash payment to any one who presents cheque on the counter of the bank __________.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. Cross cheque

  2. Demand cheque

  3. Order cheque

  4. Bearer cheque

Show answer
Correct Option: D
Explanation:

A cheque in which bank makes cash payments to anyone who presents cheque on the counter of the bank is a Bearer cheque. It is payable to bearer i.e, anyone who presents it in the bank for encashment. Bearer cheques can be transferred by mere delivery.

 _____________ is used by the account holder for depositing cash/cheques into the bank.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. Receipt

  2. Voucher

  3. Pay-in-slip

  4. Withdrawl slip

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Correct Option: C
Explanation:

Pay in slip as the name suggests is a slip that is filled by the customer to deposit money in the bank account either by cash or by cheque. The things that need to be filled in a pay in slip are the account details in which the money is to be deposited, amount to be deposited by cash or by cheque, and the signature of the depositor.

Account holders are required to carry a passbook whenever he goes to the bank to do banking transaction.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. True

  2. False

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Correct Option: A
Explanation:

True. Account holders should always carry passbook when they visit the bank for doing any transactions. The passbook has all the bank details needed to do the transactions. 

Crossed cheque is very safe cheque.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. True

  2. False

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Correct Option: A
Explanation:

True. 

A cross cheque is safer as compared to a bearer cheque as it is crossed i.e, has two parallel lines either on the whole cheque or top left which tells the banker that it cannot be encashed over the counter. It has to be directly deposited in the bank account of the person who's name is written on the cheque.

Order cheque is as good as cash.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. True

  2. False

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Correct Option: B
Explanation:

False. A Bearer cheque is as good as cash.

 A bearer cheque is payable to anyone who holds it, hence it is as good as cash. An order cheque is payable only to a particular person whose name is mentioned in the cheque. An bearer cheque is converted into an order cheque when the words "or bearer" are cancelled and the word "order" is written.  

Account holders are not allowed to carry withdrawal slips home.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. True

  2. False

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Correct Option: A
Explanation:

True. Account holders are not allowed to carry the withdrawal slips at home as there is only one part in the withdrawal slip which is kept with the bank for record purpose.

A bearer cheque is just like a withdrawal slip. 

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. True

  2. False

Show answer
Correct Option: A
Explanation:

True. A bearer cheque is just like a withdrawal slip. A bearer cheque is  payable over the counter. It is transferable by mere delivery. A withdrawal slip is a slip that to be filled by the customer to withdraw money from the bank account. In both the cases money can be received over the counter.  

Bearer cheque can be encashed by any one.

business organisation and correspondence banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks bills of exchange, promissory notes and hundis cheques

  1. True

  2. False

Show answer
Correct Option: A
Explanation:

True. A bearer cheque is a form of cheque which is payable to the bearer i.e, anyone who is holding the cheque. This can be transferred by mere delivery and there is no need for endorsement. Hence, it can be said that a bearer cheque can be encashed by anyone.