Tag: book keeping and accountancy

Quizzes (126) Questions (1524)

Questions Related to book keeping and accountancy

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

Notary public may charge his fee from the __________.

  1. drawer

  2. drawee

  3. holder of bill of exchange

  4. none of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The notary public is hired by the holder of the bill to record the dishonor. Therefore, the holder is initially responsible for paying the notary's fee.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

Which of the following is correct for presenting bill through notary public?

  1. To pay fees to notary public

  2. For "bill for collection"

  3. It is just to prove that the bill has been properly presented

  4. For drawing a fresh bill
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Noting by a notary public serves as legal proof that the bill was presented for payment and was dishonored, which is necessary for legal action.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

Which of the following statements is true?

  1. A bill cannot be endorsed more than two times

  2. A bill is drawn by purchaser

  3. A bill contains an unconditional promise to pay

  4. Noting charges are borne by the drawee in the event of dishonor of bill
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Noting charges are legally the responsibility of the drawee, as they are the party who failed to meet the obligation of the bill.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

Noting fee means __________.

  1. charges for noting the bill of exchange in the books of account

  2. payments made to the notary public for recording the fact of the bill getting dishonoured

  3. interest till the maturity date

  4. commission paid to the bank
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A noting fee is the payment made to a notary public for the official recording (noting) of the fact that a bill of exchange has been dishonored.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

Noting charges are considered as expense by the party, who makes the payment.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

When a Bill of Exchange (BOE) is dishonoured, then in order to prove this fact, the drawer (or the bill holder) may get it noted and protested through a public official known as 'Notary Public' for which it charges its fees which is called Noting Charges.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

Which of the following statements is true?

  1. Noting charge is an expense to be borne by drawer

  2. Noting charge is an expense to be borne by drawee

  3. Noting charge is an expense to be borne by payee

  4. Noting charge is an expense to be borne by bank.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Noting charges are incurred due to the drawee's failure to pay the bill on the due date; therefore, the drawee is ultimately responsible for this expense.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

When the bills is to be produced to notary public at the time of ___________.

  1. Drawing the bill

  2. Acceptance of the bill

  3. Dishonour of the bill

  4. Bills for collection
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

If there is dishonour, or fear of dishonour, the bill will be given to a public official known as “Notary Public”. The amount of noting charges is recoverable from the party which is responsible for dishonour.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

When an accommodation bill is discounted and the amount received is shared by the two parties, the discount is borne by the _________.

  1. drawee only.

  2. drawer only.

  3. drawer and drawee equally.

  4. drawer and drawee in agreed ratio.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

In an accommodation bill, the parties share the proceeds and therefore also share the costs, including the discount charged by the bank, in their agreed ratio.

Multiple choice book keeping and accountancy bill of exchange (trade bill) dishonour of a bill dishonour of bills bills of exchange advantages of bill of exchange

a bill drawn on 23.11.2013 as payable 2 months after sight was accepted on 24.11.2013. The date of maturity of this bill will be ______.

    1. 1 .2014
    1. 1 .2014
    1. 1 .2014

  4. None of these.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The bill is payable 2 months after sight. Sight date is 24.11.2013. Two months later is 24.01.2014. Adding 3 days of grace gives 27.01.2014.