Practicing Success
Practicing Success
CUET Preparation Today
| Under which heading ‘Bills discounted but not yet matured’ will be shown in the Balance Sheet of a company? |
Contingent Liabilities Current liability Unamortized Expenditure Current Assets |
| Contingent Liabilities |
| Contingent liability is a liability which might arise in future. It may or may not arise. There is no guarantee. So based on this assumption, the bills discounted but not matured are treated as contingent liability as the drawer is not sure whether the bill will be honoured at maturity or will get dishonored. If at the time of maturity the bill get dishonored, it will become the liability of the drawer to repay the amount to the bank. But if it is honoured by the payee at the time of maturity, then the drawer has no obligation to repay the amount to the bank. |
