Question

A bill was drawn on 14^th April for ₹ 7000 and was discounted on 6^th July at 5% p.a. The banker paid ₹ 6930 for the bill. Find the period of the bill.

Answer 1

Face value (F.V.) or SD = ₹ 7000,

Cash value (C.V.) = ₹ 6930,

r = 5%

Banker’s discount (B.D.) = F.V. – C.V.

= 7,000 – 6,930

= ₹ 70

Date of drawing bill = 14^th April

Date of discounting bill = 6^th July

We know that.

Banker’s discount (B.D.) =`(F.V. xx n/365 xx r)/100`

∴ `70 = (7,000 xx n/365 xx 5)/100`

∴ n = `(70 xx 100 xx 365)/(7000 xx 5)`

∴ n = 73

To calculate the period of the bill, we have to calculate 73 days from the date of the bill discounting.

July	August	September	Total
25	31	17	73 days

∴ Legal due date = 17^th September

∴ Nominal due date = 17 – 3 = 14^th September

Date of drawing bill = 14^th April. 

∴ The period of the bill from the drawing date is 5 months.