Bill of exchange can be discounted with the ______________.

Bank

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Money lender

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Agent

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Broker

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Solution

The correct option is A Bank
As per the provisions of the Negotiable Instruments Act 1881, before the due date bill of exchange can be sold to the bank. The Bank asks for an allowance of discounts in order to maintain their interest. This is called Discounting the Bill of Exchange.

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Discounting a bill of exchange means ?

On discounting of a bill of exchange with the bank, the amount of discount is borne by:

Which of the following can be done using a Bill of exchange?

A.Consignment A/c Discount A/c To Bills Receivable A/c	Dr. Dr.
A.Bank A/c Profit & Loss A/c To Bills Receivable A/c	Dr. Dr.
C.Bank A/c Consignment A/c To Bills Receivable A/c	Dr. Dr.
D.None of the above.

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