Gujarat BoardEnglish MediumSTD 12 CommerceOCMFINANCIAL MARKET3 Marks
Question
Give to the point information about “Commercial Bills”.
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Answer
Commercial Bills :
When goods are purchased on credit the seller of goods writes a commercial bill on the trader purchasing goods on credit.
When the seller writes commercial bill on the purchase, this bill is called ‘Trade Bill.’ When merchant bank accepts this bill it becomes ‘ commercial bill.’
Merchants bank discount the bills. If the bank required money it can get it enchased from financial institutions.
Normally commercial bills are for the period of $30, 60, 90$ days.
Commercial bills are negotiable. It bears unconditional order to pay fixed amount on fixed date.
There are many types of commercial bills. E.g. Bill of exchange, Inland Bill, Demand Bill, Foreign Bill etc.
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