Cancelling the original bill and drawing a fresh acceptance is known as __________.

Retiring under rebate

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Renewal

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Discounting

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Bill sent to bank for collection

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Solution

The correct option is B Renewal
Sometimes the acceptor of the bill foresees that it may be difficult to meet the obligation of the bill on maturity and may, therefore, approach the drawer with the request for extension of time for payment. In such cases the old bill is cancelled and fresh bill with new terms of payment is drawn it is called as renewal of bill.

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