Analysis bills of exchange
Answers
Answer:
What Is a Bill of Exchange?
A bill of exchange is a written order once used primarily in international trade that binds one party to pay a fixed sum of money to another party on demand or at a predetermined date. Bills of exchange are similar to checks and promissory notes—they can be drawn by individuals or banks and are generally transferable by endorsements.
Explanation:
How Bill of Exchange Transactions Works
A bill of exchange transaction can involve up to three parties. The drawee is the party that pays the sum specified by the bill of exchange. The payee is the one who receives that sum. The drawer is the party that obliges the drawee to pay the payee. The drawer and the payee are the same entity unless the drawer transfers the bill of exchange to a third-party payee.
Unlike a check, however, a bill of exchange is a written document outlining a debtor's indebtedness to a creditor. It’s not payable on demand and is usually extended with credit terms, such as 90 days. As well, a bill of exchange must be accepted by the drawee to be valid.
Bills of exchange generally do not pay interest, making them in essence post-dated checks. They may accrue interest if not paid by a certain date, however, in which case the rate must be specified on the instrument. They can, conversely, be transferred at a discount before the date specified for payment.
hope this helps
please mark me brainliest!!!!!!!
Answer:
A bill of exchange is generally used in international trade and aims at binding one party to pay a fixed amount of money to another party at a predestined future date. ... In case of being endorsed by a bank, they can be called as bank drafts and in case of being issued by individuals, they are called as trade drafts