Tag: meaning of bill of exchange

Questions Related to meaning of bill of exchange

Bills receivable account is _____________.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. an expense account

  2. an assets account

  3. a liability account

  4. a revenue account

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Correct Option: B

Bill Payable is _________.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. Real A/c

  2. Personal A/c

  3. Nominal A/c

  4. Suspense A/c

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Correct Option: B
Explanation:

The accounts which are related to individuals, persons and firms are called personal accounts. Personal accounts are further classified into Natural Personal account, Artificial Personal Account and Representative Personal account. Bills Payable represents creditors for purchases. And every creditor is a person whether artificial or personal. Therefore, bills payable is a personal account.

The hundi payable at sight is called Darshani hundi.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. True

  2. False

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Correct Option: A
Explanation:

 A hundi payable at sight is called darshani hundi. It is negotiable and is like a demand bill. It may be sold at par or at premium or at discount. A darshani hundi should be presented for payment within a reasonable time of its receipt by the holder.

____________ is designed as a summary of information regarding a duly accepted bill received by drawer.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. Bill Receivable Book

  2. Bill Payable Book

  3. Cash Book

  4. None

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Correct Option: A

________________ account representing the liability of the acceptor in respect of bills accepted by him and will always show a credit balance.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. creditor

  2. Bill Payable

  3. Loan

  4. none

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Correct Option: B

A bill given to a creditor is called bill payable.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. True

  2. False

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Correct Option: A
Explanation:

A bill payable is a document which shows the amount owed for goods or services received on credit (meaning not paid at the time that the goods or services were received).

Hence, a bill payable is also known as an unpaid vendor invoice.

Sale of Return Account in the Sale or Return Ledger represents the value of goods still lying with the customers for approval.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. True

  2. False

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Correct Option: A

Which one of the following documents attests the fact that goods of specified quantity, value and description are entering the bounds of the country.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. Bill of Lading

  2. Consular invoice

  3. Documentary bill

  4. Bill of entry

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Correct Option: D

Bills receivable account is a __________.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. nominal account

  2. personal account

  3. real account

  4. none of the above

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Correct Option: C

Bills payable book is a ____________.

elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

  1. subsidiary book

  2. principal book

  3. ledger

  4. memorandum book

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Correct Option: A
Explanation:

There are various subsidiary books which are used to record the specific transaction pertaining to the specific activity. 

Credit sales are recorded in sales book while bills payable are recorded in bills payable book which is a subsidiary book.