Balbharati solutions for Book Keeping and Accountancy [English] 12 Standard HSC Maharashtra State Board chapter 7 - Bills of Exchange [Latest edition]

The person on whom a bill is drawn is called a ______.

Before acceptance the bill is called a __________.

When the due date of bill drawn falls due on a public holiday, the payment must be made on the ___________ day.

The due date of the bill drawn for 2 months on 23rd Nov. 2019 will be ____________.

Nothing charges are borne by ____________.

There are ___________ parties to bill of exchange.

When a bill is drawn for 2 months after date on 3rd Jan. 2020, its due date will be ___________.

Notary Public is ___________.

When Acceptor or Drawee does not pay the amount of bill to the holder on the due date it is known as ___________ the bill.

The person who accepts the bill treats the bill as ________.

Give one word/phrase/term which can substitute the following statement:-

Three extra days which are allowed over and above the term of bill.

Give one word/phrase/term which can substitute the following statement:-

Fees charged by Notary Public for getting the fact of dishonour noted.

Give one word/phrase/term which can substitute the following statement:-

A person who is entitled to receive the amount of bill of exchange.

Give one word/phrase/term which can substitute the following statement:-

A person in whose favour a bill endorsed.

Give one word/phrase/term which can substitute the following statement:-

Officer appointed by government for noting of dishonour of bill.

Give one word/phrase/term which can substitute the following statement:-

Cancellation of bill on maturity in return of a new bill for extended period of credit.

Give one word/phrase/term which can substitute the following statement:-

Bill of exchange drawn and accepted without any valuable consideration.

Give one word/phrase/term which can substitute the following statement:-

Person who is in possession of Bill of Exchange.

Give one word/phrase/term which can substitute the following statement:

Conversion of Bill of Exchange into its present value.

Give one word/phrase/term which can substitute each of the following statement:-

Amount which is not recoverable from Drawee on account of insolvency.

State True or False with reason:-

Inland bill is one which is drawn in one country and payable in another country.

State True or False with reason:-

Retirement of bill means payment of the bill before due date.

State True or False with reason:-

Drawee can transfer the ownership of the bill.

State True or False with reason:-

Acceptance of bills without making any changes in the terms of the bill is called qualified acceptance.

State True or False with reason:-

Discounting is a device to convert the bill into its present value.

State True or False with reason:-

A bill of exchange must be presented to the acceptor on the due date.

State True or False with reason:-

If a bill is discounted by the holder, no entry is passed in his book when the bill is honoured on the due date.

State True or False with reason:-

Noting charges are to be borne by the drawer

State True or False with reason:-

If a bill is drawn payable ‘on-demand’ no grace days are allowed.

State True or False with reason:-

There are three parties to a promissory note.

Find the odd one:-

Find the odd one:-

Find the odd one:-

Find the odd one:-

Find the odd one:-

Making payment of bill before the due date of maturity is known as ___________.

Person whose liabilities are more than his assets and is not in position to pay off his liabilities is _________.

Amount that cannot be paid by acceptor on account of inslovency is known as __________.

A bill of exchange payable after a certain period is known as _________.

A bill which is drawn and accepted with valuable consideration is known as ___________.

A person who draws the bill of exchange is known as __________.

A bill whose due date is calculated from the date of acceptance is known a ___________.

Recording the fact of dishonour of Bill is known as ___________.

When Drawee accepts the bill payable at a particular place only, it is known as _________.

Fees charged by the bank for collection of bill on behalf of holder is ____________.

Answer in one sentence.

What do you mean by bill of exchange?

Answer in one sentence.

What are days of grace?

Answer in one sentence.

What do you mean by discounting a bill of exchange?

Answer in one sentence.

What is noting of the bill?

Answer in one sentence.

What are noting charges?

Answer in one sentence.

What is relationship between Drawer and Drawee?

Answer in one sentence.

Who is payee of the bill?

Answer in one sentence.

What do you mean by rebate?

Answer in one sentence.

What is legal due date?

Answer in one sentence.

What is bills payable on demand?

A bill of exchange is a conditional order.

Do you agree or disagree with the following statement:-

The party which is ordered to pay the amount is known as the payee.

Do you agree or disagree with the following statement:-

The person in whose favour the bill is endorsed is known as endorsee.

Do you agree or disagree with the following statement:-

Rebate or discount given on retiring a bill is an income to the Drawee.

Do you agree or disagree with the following statement:-

A bill from the point of view of debtor is called Bills payable.

Do you agree or disagree with the following statement:-

In case of bill drawn payable ‘on-demand,’ no grace days are allowed.

Do you agree or disagree with the following statement:-

A bill is required to be accepted by Drawer.

Do you agree or disagree with the following statement:-

A bill of exchange need not be dated.

Do you agree or disagree with the following statement:-

A bill before acceptance is called Promissory Note.

Do you agree or disagree with the following statement:-

Renewal is request by Drawee to extend the credit period of the bill.

Ganesh draws a bill for ₹ 40,260 on 15th Jan. 2020 for 50 days. He discounted the bill with Bank of India @15% p.a. on the same day. Calculate the amount of discount.

Shefali Traders drew a bill on Maya for ₹ 30,000 on 1st Oct. 2019 payable after 3 months. Calculate amount of discount in the following cases:

i) Shefali Traders discounted the bill on the same day @ 12% p.a.

ii) Shefali Traders discounted the bill on 1^st Nov. 2019 @ 12% p.a.

iii) Shefali Traders discounted the bill on 1^st Dec. 2019 @ 12% p.a.

Veena who had accepted Sudha’s bill for ₹ 28,000 was declared bankrupt and only 35 paise in a rupee could be recovered from her estste. Calculate the amount of bad debts.

Nitin renewed his acceptance for ₹ 72,000 by paying ₹ 22,000 in cash and accepting a new bill for the balance plus interest @ 18% p.a. for 4 months. Calculate the amount of new bill.

Nisha’s acceptance for ₹ 16,850 sent to bank for collection was honoured and bank charges debited were ₹ 125. Find out the amount actually received by Drawer.

A bill of ₹ 16,000 was drawn by Keshav on Gopal on 12th June 2019 for 2 months. What will be the due date, if all of sudden, the legal due date is declared as an emergency holiday?

Prepare a bill of exchange form the following information:

Drawer: Shankar, Vadodara, Gujrat.

Drawee: Vinayak, Somwarpeth, Pune.

Amount : ₹ 16,000

Period : 3 months

Date of Bill: 6th Sept. 2019.

Date of acceptance: 11th Sept. 2019.

Prepare a bill of exchange from the following information:

Drawer: Dinesh, P. R. Road, Andheri West.

Drawee: Mahesh, L. B. S. Road, Mulund.

Payee: Amit, Thane West.

Amount: ₹ 9,500

Period of Bill: 4 months after sight.

Date of Bill: 26th Nov. 2019.

Date of acceptance: 29th Nov. 2019.

Kantilal, 343/D, Palm Heights, Jogeshwari, drew a bill on 10^th Oct. 2019 for ₹ 63,490 for 45 days after date on Shantilal, B2, Himalaya Towers, Baramati, payable to Priyanka, Satara. The bill was accepted on 13th Oct. 2019 for 60 days.

Prepare a format of bill of exchange from the above details.

Prepare a format of bill exchange from the following details :

Rahul Sane, 86-D, Raviwar Peth, Nagpur accepted the bill drawn on him by Prithviraj, Icon Heights, Wardha for ₹ 87,000 on 30^th July 2019. The bill was drawn on 26^th July 2019 for ₹ 1,00,000 for 90 days after date.

Prepare a format of bill of exchange from the following.

Drawer: Kashmira Shah, Partner M/S Shah, and Shah, 2-C, Matruchaya Building, Akola. Drawee: Dhanashree Traders, Bangalore Road, Belgaum. (Signed by Jayashree, Partner) Payee: M/S Janki Traders, Akola.

Amount : ₹ 64,500

Period of Bill : 3 months

Date of drawing: 12^th Sept. 2019

Date of acceptance: 15^th Sept. 2019

Prepare a demand bill with imaginary Drawer, Drawee, Address, Amount, and Date.

Complete the following Table

Complete the following Table

On 1^st Jan. 2020 Hemant sold goods of ₹ 18,500 to Nitin. On the same date, Hemant drew a bill of exchange for ₹ 18,500 at 2 months. On the due date, the bill was duly honoured.

Give Journal Entries in the Books of Hemant and Nitin. Prepare Hamant’s account in the books of Nitin.

Neha sold goods to Rohan's ₹42,000 on 6th Sept. 2019. Neha drew a bill of exchange at 3 months for the amount which was accepted by Rohan. Neha disounted the bill with her bankers at ₹ 41,000. On the due date of the bill, Rohan dishonoured the bill and bank paid ₹ 300 as Noting Charges

Show Journal Entries in the Books of Neha and Rohan.

Jyoti owes ₹ 31,000 to Swati for which was draws a bill on Jyoti for 2 months. The bill was duly accepted by Jyoti. Swati sends the bill to bank for collection. Jyoti honoured the bill on the due date and bank charges ₹ 475 as bank charges.

Give Journal Entries in the Books of Swati.

Pankaj purchased goods of ₹ 20,000 from Omprakash on credit on 15th April 2019. Omprakash draws After Sight bill for the amount due on Pankaj for 3 months, which was accepted by Pankaj on 18th April, 2019. On 20th April, 2019 Omprakash endorsed the bill to his creditor Jagsish in full settlement of his amount ₹ 21,000. On the due date, the bill was dishonoured by Pankaj.

Give Journal Entires in the Books of Omprakash, Pankaj and Jagdish.

Siddhant sold goods to Sudhir of  ₹ 43,800 on 18^th March 2019. Siddhant draws a bill on Sudhir on the same day for ₹ 43,800 for 3 months which was duly accepted by Sudhir. Siddhant discounted the bill on the same day at 8% p.a. the bill was dishonoured on the due date and Sudhir requested Siddhant to accept ₹ 13,800 and interest in cash on remaining amount at 12% p.a. Siddhant agreed and for the balance, the amount accepted a new bill at 2 months. Before the due date of new bill, Sudhir retired the bill by paying ₹ 29,700.

Pass necessary Journal Entries in the Books of Siddhant.

Sangeeta accepted a bill for ₹ 18,000 drawn by Geeta at 3 months. Geeta discounted the bill for ₹ 17,400. Before the due date Sangeeta approached Geeta for renewal of the bill. Geeta agreed on the condition that Sangeeta should pay  ₹ 6,000 immediately and for the balance, she should accept a new bill for 4 months along with interest ₹ 550. The arrangements were carried through. But on the due date of new bill Sangeeta became insolvent and 35 paise in a rupee could be recovered from her estate.

Give Journal Entries in the Books of Sangeeta and prepare Sangeeta’s account in the books of Geeta.

Priyanka owed Meena ₹ 18,000, Priyanka accepted a bill drawn Meena for the amount at 4 months. Meena endorsed the same bill to Sagar. Before due date Priyanka approached Meena for renewal of bill. Meena agreed on condition that ₹ 6,000 be paid immediately together with interest on the remaining amount of 8 % p. a. for 3 months and Priyanka should accept a new bill for the balance amount. These arrangements were carried through. However, before the due date, Priyanka became insolvent and only 50 % of the amount could be recovered from her estate.

Give Journal Entries in the Books of Meena.

Seema purchased goods from Roma on credit on 1 st August, 2019 fo ₹ 37,000, Seema accepts bill for 2 months drawn by Roma for the same amount on the same day Roma discounts the bill with the bank for ₹ 36,200 on 3rd August 2019. On the due date the bill is dishonoured and Noting Charges of ₹ 160 is paid by the bank. Seema pays ₹ 19,000 and Noting Charges in cash immediately. Anew bill is drawn by Roma for the balance including interest ₹ 650 for 2 months, which is accepted by Seema. The new bill is retired one month before the due date at a rebate of ₹ 300

Give Journal Entries in the Books of Seema and prepare Seems’s Account in the books of Roma.

Uday purchased goods from Shankar on credit for  ₹ 35,000 at 10 % Trade discount. Uday paid ₹1,500 immediately and for the balance accepted a bill for 3 months. Before the due date, Uday approached Shankar with a request to renew the bill. Shankar agreed but with condition that Uday should accept a new bill for 3 months including interest at 12 % p.a.

Give Journal Entries in the Books of Shankar.

Sagar drawn an after sight bill on 21st Nov. 2019 for ₹ 21,000 at 3 months on Prasad. The bill is discounted by Sagar at 8 % p. a. with his bank. On maturity, Prasad finds himself unable to make payment of the bill and requests Sagar to renew it. Sagar accepts the request and draws a new bill at one month for ₹ 21,750 including interest which was duly accepted by Prasad. Sagar deposits the bill into bank for the collection. Prasad honours the bill on the due date and Bank charges ₹ 250 as Bank Charges.

Pass necessary Journal Entries in the Books of Sagar and prepare Sagar’s account in the books of Prasad.

Journalise the following transaction in the books of Abhishek:-

a) Siddhant informs Abhishek that Vineet’s acceptance for ₹ 23,000 endorsed to Siddhant has been dishonoured. Nothing Charges amounted to ₹ 430.

b) Kajal renews her acceptance to Abhishek for ₹ 39,000 by paying 3,000 in cash and accepting a fresh bill for the balance along with interest at 11.5 % p.a. for 3 months.

c) Radhika retired her acceptance to Abhishek for ₹ 23,000 by paying ₹ 22,250 by cheque.

d) Abhishek sent a bill of Subodh for ₹ 9,000 to bank for collection. Bank informed that the bill has been dishonoured by Subodh.

Journalise the following transactions in the books of Narendra: -

a) Narendra retires his acceptance to Upendra by paying ₹ 4,000 in cash and endorsing a bill accepted by Ramlal for ₹ 5,000.

b) Vikram’s acceptance to Narendra ₹ 6,000 retired one month before the due date at rebate of 12% p.a.

c) Dilip renews his acceptance to Narendra for ₹ 12,000 by paying ₹ 4,000 in cash and accepting a fresh bill for the balance plus interest at 12% p.a. for 3 months.

d) Bank informed Narendra that, Kartik’s acceptance for ₹ 13,000 to Narendra, discounted with the bank was dishonoured and Noting Charges paid by bank ₹ 140.

Journalise the following transactions in the books of Bharti:-

a) Bank informed that Amit’s acceptance for ₹15,750 sent to bank for collection was honoured and bank charges debited were ₹ 150.

b) Nitin renewed his acceptance for ₹ 22,200 by paying ₹ 2,200 in cash along with interest on balance amount at 10% and accepted a fresh bill for the balance for 3 months.

c) Dhanshri who had accepted Bharti’s bill for ₹ 17,500 was declared insolvent and only 40% of the amount due could be recovered from his estate.

d) Discharged our acceptance to Savita for ₹ 9,450 by endorsing Pravin’s acceptance to us ₹ 9,000.

Journalise the following transactions in the books of Sudha:-

a) Endorsed Sonali’s acceptance at 2 months for ₹ 6,000 in favour of Urmila and paid cash ₹ 3,500 in full settlement of her account ₹ 10,000.

b) Discounted 2 months acceptance of Surya for ₹ 7,800 with bank at 10% p.a.

c) Bank informed that Anuradha’s acceptance of ₹ 4,800 which was discounted was dishonoured and bank paid Noting Charges ₹ 125.

d) Pooja honoured her acceptance of ₹ 16,400 which was deposited into bank for collection.

Journalise the following transactions in the books of Mrunal:

a) Bank informed that Aishwarya’s acceptance of ₹ 24,000 which was discounted had been dishonoured and bank paid Noting Charges ₹ 220. Bill was renewed at the request of Aishwarya for 2 months with interest of ₹ 480.

b) Received ₹ 4,630 from private estate of Ankur who was declared insolvent against bill accepted by him for ₹ 6,000.

c) Accepted a bill of ₹ 15,000 at 3 months drawn by Anushka for the amount due to her ₹  20,000 and balance paid by cheque.

d) Dishonoured our acceptance to Vivek ₹ 27,000 and Noting Charges paid by Vivek ₹ 700.