Banking · Lending and Credit Operations
A customer has an Overdraft (OD) limit of ₹10,00,000 against book debts. On Monday, the debit balance is ₹9,50,000. On Tuesday morning, the customer deposits an uncleared cheque for ₹2,00,000. The bank allows drawing against 50% of the value of uncleared local cheques. On Tuesday afternoon, two cheques drawn by the customer are presented: Cheque A for ₹1,50,000 and Cheque B for ₹80,000. Calculate: (1) Drawing Power before deposit, (2) Temporary Drawing Power after deposit, and (3) Status of the two presented cheques.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1(1) ₹10,00,000; (2) ₹12,00,000; (3) Both cheques honored.
- 2(1) ₹50,000; (2) ₹2,50,000; (3) Both cheques honored.
- 3(1) ₹50,000; (2) ₹1,50,000; (3) ₹1,50,000 cheque honored, ₹80,000 cheque returned.✓
- 4(1) ₹50,000; (2) ₹1,50,000; (3) Both cheques honored.
Correct answer
(1) ₹50,000; (2) ₹1,50,000; (3) ₹1,50,000 cheque honored, ₹80,000 cheque returned.
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