Question

_____________ means payment of the bill before due date.

(a) Discounting of bill
(b) Retirement of bill
(c) Renewal of bill
(d) Endorsement of bill

Answer 1

Retirement of the bill means payment of the bill before the due date.

 

Explanation: A bill is said to be retired when the acceptor of a bill expresses his willingness to make the payment of the bill before its due date. In such cases, the holder of the bill generally allows a discount to the drawee, which is called rebate. This rebate is a gain for the party that makes the payment (i.e. the drawee) and is an expense to the party receiving the payment (i.e. the drawer).