Important Terms — Demand Bill, Time Bill, Days of Grace, Due Date

Before any discounting can be calculated, the exact date on which the bill must be paid has to be fixed. The Odisha CHSE Std-11 Business Mathematics and Statistics treatment uses the following standard terms.

• Demand bill (bill at sight): payable on demand or as soon as it is presented — there is no fixed future period, and (by convention) no days of grace are allowed.
• Time bill (term bill): payable after a fixed period stated on the bill — for example, "three months after date" or "90 days after sight." Only time bills earn days of grace.
• Term (tenure): the length of time for which the bill is drawn (e.g., 3 months, 90 days). It runs from the date of the bill ("after date") or from the date of acceptance ("after sight").
• Nominal due date: the date obtained by simply adding the term to the starting date.
• Days of grace: by long-established custom, 3 extra days are added to the nominal due date of a time bill. The date so obtained is the date the bill legally falls due.
• Legally due date (date of maturity): nominal due date + 3 days of grace. This is the date used in all discounting arithmetic — the money is actually due on this date, not on the nominal date.
• Discounting a bill: the holder of a bill needing cash before maturity may hand it over to a banker, who pays cash now after deducting a charge for the waiting time. The bill is then said to be discounted. …