Practice Acceptance Of The Bill (5.5.2) - Bills of Exchange

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6 sample questions

Question 1.
What does it mean to accept a bill of exchange?
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Think about what the drawee is agreeing to.
Question 2.
What is the role of the acceptor?
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Remember the transformation from drawee.
3Question 3.
What happens when a drawee accepts a bill of exchange?
- They negotiate a lower amount.
- They become the acceptor.
- They refuse to pay.
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Think about the change in responsibility.
4Question 4.
True or False: Acceptance of a bill of exchange does not legally bind the drawee.
- True
- False
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Recall the consequences of acceptance.
Question 5.
A company issues a bill of exchange for $50,000 to be paid in 90 days. The drawee accepts the bill. Explain the obligations of the acceptor upon acceptance.
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Consider the steps leading from acceptance to payment.
Question 6.
You have a situation where a bill of exchange was accepted, but the drawee went bankrupt before the due date. What options does the payee have?
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Think about the implications of dishonor and bankruptcy.

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