Question

Explain briefly the purpose and advantages of maintaining of a Bills
Receivable Book.

Answer 1

The purpose of a bills receivable book is to record all the bills which are received from the debtors of a firm. Its advantages are provided below.

Explanation:

A bills receivable book is a part of accounting. It is a subsidiary book in which the bills of exchange are kept and recorded.  

The purpose of a bills receivable book is to record all the bills which are received from the debtors of a firm. This book includes details of the amount receivable such as date, name of the acceptor, amount, terms etc. for the reference of future.  

There are few advantages of maintaining a bills receivable book properly, which are as follows:

i. It tracks customer credit.

ii. It helps in building customer loyalty.

iii. It keeps proper track of uncollected profits of an organization.

iv. It helps to provide all information just at a glance.