CMA Foundation · Fundamentals of Financial and Cost Accounting · Bills of Exchange
A bill drawn on 31 December 2024 is payable 'two months after date'. Ignoring days of grace and holidays, what is its nominal due date?
The nominal due date is 28 February 2025. When the period is stated in months and the corresponding day does not exist in the month reached, the bill falls due on the last day of that month.
- A28 February 2025Correct
- B2 March 2025
- C1 March 2025
- D31 February 2025
Explanation
Months are counted in calendar months. Two months after 31 December is 31 February, which does not exist, so the due date falls on the last day of that month, 28 February 2025 (non-leap year). Moving into March would overstate the term.
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