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Question
_____________ means payment of the bill before due date.
(a) Discounting of bill
(b) Retirement of bill
(c) Renewal of bill
(d) Endorsement of bill
(b) Retirement of bill
(c) Renewal of bill
(d) Endorsement of bill
Solution
Retirement of the bill means payment of the bill before the due date.
Explanation: A bill is said to be retired when the acceptor of a bill expresses his willingness to make the payment of the bill before its due date. In such cases, the holder of the bill generally allows a discount to the drawee, which is called rebate. This rebate is a gain for the party that makes the payment (i.e. the drawee) and is an expense to the party receiving the payment (i.e. the drawer).
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Important Terms of Bills of Exchange - Due Date
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A bill is drawn on 23rd Sept., 2013 at 4 months would be payable on .................................
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Retirement of bill means payment of the bill before due date.
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Answer the following question in one sentence only.
What is due date of bill?
