Retirement of bill [RTP Jan. 2025]; [MTP Jan. 2025]
Options
A
B
C
D
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Bills of Exchange and Promissory NotesQ-3 | Bills of Exchange and Promissory NotesQuestion 4760 of 26
All Questions Correct Answer
✅ Option — Correct Option
All Options:
- A
- B
- C
- D
Detailed Solution & Explanation
Retirement of the bill :
Retirement of the bill means that payment is made before the due date. ◆ Therefore, normally
the receiver will allow some rebate/discount to the payer.
Entry for payment/receipt will be recorded net of rebate.
Thus, retirement is the opposite of renewal. In retirement payment is made early whereas in
renewal payment is delayed.
Key Concepts to Understand
More Questions from Bills of Exchange and Promissory Notes
A firm purchased a second-hand machinery on April 1, 2021 for 15,00,000 subsequent to which ₹ 2,00,000 were spent on its repairs and installation. On October 1, 2021 another machinery was purchased for 9,00,000 and cost of installing the machine in a new plant is ₹ 20,000. The firm also shifted the machinery purchased on April 1, 2021 to the new plant and incurred freight of 10,000. They adopted a policy of charging depreciation @ 12% per annum on diminishing balance method. On April 1, 2023 it was decided to change the method and rate of depreciation to straight line basis. On this date, the remaining useful life was assessed as 5 years for both the machines purchased with no scrap value. On October 1, 2023 the first machine become outdated and sold for 2,50,000. On the same date, another machinery was purchased for * 8,50,000. The estimated useful life of the machine is 10 years and residual value is ₹ 30,000. You are required to prepare the machinery account for the year ending March 31, 2024. [Jan. 2025, 10 Marks]
Bill of exchange and the various parties to it. [MTP Jan. 2025]
Meaning of Promissory Note
Bill of Exchange and Promissory Note
A promissory note can be made payable to the bearer. [Sep. 2024, 2 Marks]
Promissory Note is different from Bill of Exchange because the amount is paid by the maker in case of former and by the acceptor in the later. [June 2024, 2 Marks]
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