CMA Foundation · Fundamentals of Financial and Cost Accounting · Bills of Exchange
Ravi Traders accepted a bill dated 5 November 2024 payable 'two months after sight'. It was presented for acceptance and accepted on 10 November 2024. Disregarding holidays, what is the date on which the bill falls legally due?
The bill falls legally due on 13 January 2025. Because it is payable after sight, the two months are counted from the acceptance date of 10 November 2024, giving 10 January 2025, and three days of grace are then added.
- A8 January 2025
- B13 January 2025Correct
- C10 January 2025
- D8 January 2025 with no grace days
Explanation
For a bill after sight, the term runs from the date of acceptance, not the drawing date. Two months after 10 November 2024 is 10 January 2025. Adding three days of grace gives 13 January 2025. Counting from 5 November would give 8 January, which is the wrong base.
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