Class 11 Accountancy - Chapter Bill of Exchange NCERT Solutions | Distinguish between bill of exchange and
Distinguish between bill of exchange and promissory note.
Bill of Exchange:
- A bill of exchange is an instrument in writing containing an unconditional order signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument.
- There may be three parties- drawer, acceptor and payee.
- It is drawn by the creditor.
- It needs acceptance by the drawee.
- The liability of the drawer is secondary.
Promissory Note:
- A promissory note is a financial instrument that contains a written promise by one party (the note’s issuer or maker) to pay another party (the note’s payee) a definite sum of money, either on demand or at a specified future date.
- There are only two parties- the maker who draws the note and sign it and the payee to whom the amount is payable.
- It is drawn by the debtor.
- It does not need acceptance.
- The liability of the maker is primary.
More Questions From Class 11 Accountancy - Chapter Bill of Exchange
- Q:-
Fill in the blanks:
(i) A bill of exchange is a __________ instrument.
(ii) A bill of exchange is drawn by the __________ upon his __________.
(iii) A promissory note is drawn by __________ in favour of his __________.
(iv) There are __________ parties to a bill of exchange.
(v) There are __________ parties to a promissory note.
(vi) Drawer and __________ can not be the same parties in case of a bill of exchange.
(vii) Bill of exchange in India languages is called __________.
(viii) __________ days of grace are added in terms of the bill to calculate the date of its __________. - Q:-
Write ‘True’ or ‘False’ against each statement regarding a bill of exchange:
(i) A bill of exchange must be accepted by the payee.
(ii) A bill of exchange is drawn by the creditor.
(iii) A bill of exchange is drawn for all cash transaction.
(iv) A bill payable on demand is called Time bill;
(v) The person to whom payment is to be made in a bill or exchange is called payee.
(vi) A negotiable instrument does not require the signature of its maker.
(vii) The hundi Payable at sight is called Darshani hundi.
(viii) A negotiable instrument is not freely transferable.
(ix) Stamping of promissory note is not mandatory.
(x) The time of payment of a negotiable instrument need not be certain. - Q:-
Briefly explain the effects of dishonour and noting of a bill of exchange.
- Q:-
Explain briefly the procedure of calculating the date of maturity of a bill of exchange? Give example.
- Q:-
Briefly explain the benefits of maintaining a Bills Payable Book and state how is its posting is done in the ledger?
- Q:-
Give the meaning of rebate.
- Q:-
Briefly explain the purpose and benefits of retiring a bill of exchange to the debtor and the creditor.
- Q:-
What is meant by maturity of a bill of exchange?
- Q:-
Name the parties to a promissory note.
- Q:-
A bill of exchange must contain “an unconditional promise to pay” Do you agree with a statement?
Popular Questions of Class 11 Accountancy
- Q:-
Why is it necessary to record the adjusting entries in the preparation of final accounts?
- Q:-
State the meaning of incomplete records?
- Q:-
What is ‘Depreciation’?
- Q:-
Briefly state how the cash book is both journal and a ledger.
- Q:-
State the meaning of a trial balance?
- Q:-
State the four basic requirements of a database applications.
- Q:-
Define accounting.
- Q:-
State the different elements of a computer system.
- Q:-
Why is it necessary for accountants to assume that business entity will remain a going concern?
- Q:-
State the need for the preparation of bank reconciliation statement?
Recently Viewed Questions of Class 11 Accountancy
- Q:-
State the meaning of:
(a) Outstanding expenses
(b) Prepaid expenses
(c) Income received in advance
(d) Accrued income - Q:-
What is a journal? Give a specimen of journal showing at least five entries.
- Q:-
What are financial statements? What information do they provide.
- Q:- Explain the qualitative characteristics of accounting information.
- Q:-
Distinguish between debtors and creditors.
- Q:-
Which of the following is not an error of principle:
(a) Purchase of furniture debited to purchases account.
(b) Repairs on the overhauling of second hand machinery purchased debited to repairs account.
(c) Cash received from Manoj posted to Saroj.
(d) Sale of old car credited to sales account. - Q:-
How many sides does an account have?
(i) Two
(ii) Three
(iii) one
(iv) None of these - Q:-
Differentiate between source documents and vouchers.
- Q:-
Explain the reasons where the balance shown by the bank passbook does not agree with the balance as shown by the bank column of the cash book.
- Q:-
Name and explain different types of reserves in detail.
- All Chapters Of Class 11 Accountancy
- All Subjects Of Class 11