Accountancy, asked by Prajnya788, 1 year ago

Bills purchased and discounted is classified as which assets

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Answered by TwinkleTwinkle11111
0
Apart from sanctioning loans and advances in various forms and, on the security of various types of goods and documents etc., Bills Purchased and Discounted is the way of employing the bank funds. Such Bills of exchange arising out of commercial transactions both in inland trade and foreign trade.

These Bills of Exchange are classified into demand bills and usance bills. Where a bill is payable at sight or on demand or on presentation, it is called a demand bill.

If a bill matures for payment after a certain period of time, say 30, 60 or 90 days after the date, or after sight, it is called a usance bill. Both these bills may be clean or documentary.

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