Renewable of a Bill:
Negotiation:
Difference between Bill of Exchange and Promissory Note with examples.
Accounting of Bill of Exchange and Promissory Note.
Drawing,Acceptance and Payment of Bill:
When Bill is Retained Till the Date of Maturity.
When Bill is Discounted with the Bank.
When Bill is Sent to Bank For Collection.
Distinction between Discounting Charges and Noting Charges.
Answers
Answer:
BUSINESS BUSINESS ESSENTIALS
Bills of Exchange vs. Promissory Notes: What's the Difference?
By
J.B. MAVERICK
Updated May 28, 2021
Fact checked by
SUZANNE KVILHAUG
Bills of Exchange vs. Promissory Notes: An Overview
Bills of exchange and promissory notes are written commitments between two parties that confirm a financial transaction has been agreed upon. Bills of exchange are more often used in international trade, whereas promissory notes are used most often in domestic trade.
KEY TAKEAWAYS
Bills of exchange and promissory notes are two types of financial instruments used to confirm a deal has been struck.Both financial instruments are written commitments between a buyer and seller, or any other parties that are agreeing to a financial transaction.Bills of exchange are documents that show a buyer has agreed to pay a seller a specific amount to be paid at an agreed-upon point in time.The parties usually bring in a bank to issue the bill of exchange, due to the risks that come with international transactions; as such, the bill is also known as a bank draft.Promissory notes are debt notes that provide financing to individuals or corporations from a non-traditional lender, such as one of the parties involved in a sale.1Promissory notes have in the past mostly been used by only corporations or high-net-worth investors, but have recently been used more often in real estate transactions.2
Bills of Exchange
A bill of exchange is a written agreement between two parties—the buyer and the seller—used primarily in international trade. It is documentation that a purchasing party has agreed to pay a selling party a set sum at a predetermined time for delivered goods. The buyer or seller typically employs a bank to issue the bill of exchange due to the risks involved with international transactions. For this reason, bills of exchange are sometimes also referred to as bank drafts.