Class 11 Accountancy - Chapter Bill of Exchange NCERT Solutions | Briefly explain the benefits of maintain
Briefly explain the benefits of maintaining a Bills Payable Book and state how is its posting is done in the ledger?
A Bills Payable Book is a special purpose book, maintained to keep records of acceptance of bills, given to the creditors. It contains details of the amount, date of bill, due date, to whom acceptance is given, etc., for future references. It is totaled periodically and its balance is transferred to the credit side of the bills payable account. Benefits of Maintaining Bills Payable Book:
a. Availability of information: All the information related to the bills payable are recorded at one place, such as the amount, due date, etc.
b. Possibility of fraud: Since all the bills are recorded at one place, possibility of fraud is minimized.
c. Responsibility: All the transactions are recorded by the same person. Therefore, errors can be easily detected and rectified. This leads to a higher degree of responsibility and accountability of the accountant.
d. Time efficient: Recording of bills payable through the bills payable book takes lesser time than that of journal entry.
Therefore, it saves time of the accountant in recording numerous transactions of repetitive and routine nature. The postings from these books are made to the debit of the account of every creditor to whom acceptance has been given and the periodical total of the books is credited to the ‘Bills Payable Account’ in the ledger.
The bills payable account representing the liability of the acceptor in respect of bills accepted by him, always has credit balance, if any. The credit balance of this account on any particular date must be the same as the total amount worth of bills payable yet to be presented for payment as ascertained from the bills payable book.
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:-
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:-
A bill of exchange must contain “an unconditional promise to pay” Do you agree with a statement?
- Q:-
Name the parties to a promissory note.
- Q:-
Give the performa of a Bills Payable Book.
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:-
The journal entry to record purchase of equipment for ₹ 2,00,000 cash and a balance of ₹ 8,00,000 due in 30 days include:
(a) Debit equipment for ₹ 2,00,000 and Credit cash ₹ 2,00,000.
(b) Debit equipment for ₹ 10,00,000 and Credit cash ₹ 2,00,000 and creditors ₹ 8,00,000.
(c) Debit equipment ₹ 2,00,000 and Credit debtors ₹ 8,00,000.
(d) Debit equipment ₹ 10,00,000 and Credit cash ₹ 10,00,000. - Q:-
When a firm maintains a cash book, it need not maintain ;
(i) Journal Proper
(ii) Purchases (journal) book
(iii) Sales (journal) book
(iv) Bank and cash account in the ledger - Q:-
What is difference between trade discount and cash discount?
- Q:-
Fill in the blanks :
(i) Passbook is a copy of.............as it appears in the ledger of the bank.
(ii) When money is with drawn from the bank, the bank ............. the account of the customer.
(iii) Normally, the cash book shows a debit balance, passbook shows .............balance.
(iv) Favourable balance as per the cash book means .............balance in the bank column of the cash book.
(v) If the cash book balance is taken as starting point the items which make the cash book balance smaller than the passbook must be .............for the purpose of reconciliation.
(vi) If the passbook shows a favourable balance and if it is taken as the starting point for the purpose of bank reconciliation statement then cheques issued but not presented for payment should be .............to find out cash balance.
(vii) When the cheques are not presented for payment, favourable balance as per the cash book is .............than that of the passbook.
(viii) When a banker collects the bills and credits the account passbook overdraft shows .............balance.
(ix) If the overdraft as per the passbook is taken as the starting point, the cheques issued but not presented are to be .............in the bank reconciliation statement.
(x) When the passbook balance is taken as the starting point items which makes the passbook balance .............than the balance in the cash book must be deducted for the purpose of reconciliation. - Q:-
Briefly state how the cash book is both journal and a ledger.
- Q:-
Who are the external users of information?
- Q:-
Accounting equation remains intact under all circumstances. Justify the statement with the help of an example.
- Q:-
State the causes of difference occurred due to time lag.
- Q:-
What are special purpose books?
- Q:-
What are the steps taken by an accountant to locate the errors in the trial balance?
- All Chapters Of Class 11 Accountancy
- All Subjects Of Class 11