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Bills of Exchange (Four parties : (Drawee :check: (Who Buys the…
Bills of Exchange
Four parties :
Drawee :check:
Who Buys the goods/Services
He who accepts and signs the bill of exchange and send back to the Drawer.
Payee :check:
Who Receives the Payment :
He who receives the payment on maturity of the above said bill, this can be drawer or any other person if drawer endorses the bill.
Drawer :check:
Who solds the goods/Services
He who creates the bills of exchange and send it to Drawee for acceptance.
Payer :check:
Who pay's the amount on Bill.
He who pays the amount of bill, he may be Drawee or any other person on behalf.
Drawer
Points to remember
Creditor
Sold goods on credit (not a cash sale)
Bills Receivable - Asset
Raised a bill of exchange
Drawee
Points to remember
Debtor
Purchases goods on credit (not a cash Purchase)
Bills Payable - Liability
Accept a bill of exchange from Drawer