{"id":231016,"date":"2025-10-17T20:15:27","date_gmt":"2025-10-17T14:45:27","guid":{"rendered":"https:\/\/www.oliveboard.in\/blog\/?p=231016"},"modified":"2025-10-17T20:15:34","modified_gmt":"2025-10-17T14:45:34","slug":"bills-of-exchange","status":"publish","type":"post","link":"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/","title":{"rendered":"Bills of Exchange: Meaning, Parties, Types &amp; Accounting Entries"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_77 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of content<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#What_is_a_Bill_of_Exchange\" >What is a Bill of Exchange?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Characteristics_of_a_Bill_of_Exchange\" >Characteristics of a Bill of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Parties_to_a_Bill_of_Exchange\" >Parties to a Bill of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Specimen_of_a_Bill_of_Exchange\" >Specimen of a Bill of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Types_of_Bills_of_Exchange\" >Types of Bills of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Key_Terms_Related_to_Bills_of_Exchange\" >Key Terms Related to Bills of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Accounting_Treatment_of_Bills_of_Exchange\" >Accounting Treatment of Bills of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Importance_of_Bills_of_Exchange\" >Importance of Bills of Exchange<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#Difference_Between_Bill_of_Exchange_and_Promissory_Note\" >Difference Between Bill of Exchange and Promissory Note<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/#FAQs\" >FAQs<\/a><\/li><\/ul><\/nav><\/div>\n\n<p>A Bill of Exchange is an important financial instrument used in business transactions to ensure payment between buyers and sellers. It acts as a written, unconditional order by one party (the drawer) to another (the drawee) to pay a certain sum of money to a specific person (the payee) or to the bearer of the bill, either on demand or at a fixed future date.<\/p>\n\n\n\n<p>Bills of exchange help in facilitating credit sales, provide security of payment, and can be used for discounting to meet immediate cash needs.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-is-a-bill-of-exchange\"><span class=\"ez-toc-section\" id=\"What_is_a_Bill_of_Exchange\"><\/span>What is a Bill of Exchange?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A <strong>Bill of Exchange<\/strong> is defined under <em>Section 5 of the Negotiable Instruments Act, 1881<\/em>. It states:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cA Bill of Exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument.\u201d<\/p>\n<\/blockquote>\n\n\n\n<p>In simple terms, it is a promise made in writing by the debtor (drawee) to pay the creditor (drawer) a specified amount, either immediately or on a future date.<\/p>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-16018d1d wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-text-align-center wp-element-button\" href=\"https:\/\/www.oliveboard.in\/upsc-epfo-eo\/?ref=conttm-aib&amp;next=https:\/\/u1.oliveboard.in\/exams\/lessons\/obnotesplus\/?c=epfoeon&amp;testid=\" target=\"_blank\" rel=\"noreferrer noopener\">get UPSC EPFO Notes for exam preparation<\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-characteristics-of-a-bill-of-exchange\"><span class=\"ez-toc-section\" id=\"Characteristics_of_a_Bill_of_Exchange\"><\/span>Characteristics of a Bill of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Before discussing the parties and process, it\u2019s important to understand the basic characteristics that make a document a valid bill of exchange.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Characteristic<\/strong><\/td><td><strong>Description<\/strong><\/td><\/tr><tr><td><strong>Written Document<\/strong><\/td><td>It must be in writing (printed or handwritten).<\/td><\/tr><tr><td><strong>Unconditional Order<\/strong><\/td><td>The payment order should not depend on any condition.<\/td><\/tr><tr><td><strong>Signature of Drawer<\/strong><\/td><td>It must be signed by the person who draws (makes) the bill.<\/td><\/tr><tr><td><strong>Definite Amount<\/strong><\/td><td>The amount payable should be certain and clearly mentioned.<\/td><\/tr><tr><td><strong>Definite Time<\/strong><\/td><td>The date or time of payment must be fixed or determinable.<\/td><\/tr><tr><td><strong>Payee Must Be Certain<\/strong><\/td><td>The person to whom payment is made must be clearly identified.<\/td><\/tr><tr><td><strong>Stamped Instrument<\/strong><\/td><td>It must be duly stamped as per the Stamp Act.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-parties-to-a-bill-of-exchange\"><span class=\"ez-toc-section\" id=\"Parties_to_a_Bill_of_Exchange\"><\/span>Parties to a Bill of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Every bill of exchange involves three main parties. Understanding their roles helps in grasping how the instrument operates.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Party<\/strong><\/td><td><strong>Role<\/strong><\/td><td><strong>Description<\/strong><\/td><\/tr><tr><td><strong>Drawer<\/strong><\/td><td>Maker of the bill<\/td><td>The person who sells goods or services and draws the bill to receive payment.<\/td><\/tr><tr><td><strong>Drawee<\/strong><\/td><td>Payer of the bill<\/td><td>The person who buys goods or services and is directed to pay the amount.<\/td><\/tr><tr><td><strong>Payee<\/strong><\/td><td>Receiver of payment<\/td><td>The person who will receive the payment. Usually, the drawer himself or any third party nominated by him.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>Example:<\/strong><br>If A sells goods to B worth \u20b910,000 on credit and draws a bill on B, then:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A is the drawer (and payee, if payment is to A),<\/li>\n\n\n\n<li>B is the drawee,<\/li>\n\n\n\n<li>The bill amount is \u20b910,000 payable on a specified date.<\/li>\n<\/ul>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-16018d1d wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.oliveboard.in\/upsc-epfo-apfc\/?ref=conttm-aib\" target=\"_blank\" rel=\"noreferrer noopener\">enrol in UPSC EPFO APFC Online coaching<\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-specimen-of-a-bill-of-exchange\"><span class=\"ez-toc-section\" id=\"Specimen_of_a_Bill_of_Exchange\"><\/span>Specimen of a Bill of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Before listing examples, note that a bill must contain specific elements like date, parties, amount, and signature. Here\u2019s a sample format:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p><strong>Stamp<\/strong><br>\u20b910,000<\/p>\n\n\n\n<p>Three months after date, pay to Mr. A or order, the sum of Rupees Ten Thousand only, for value received.<\/p>\n\n\n\n<p><strong>To:<\/strong> Mr. B<br>(Drawee)<br><strong>Accepted<\/strong><br>(Signature of B)<\/p>\n\n\n\n<p><strong>Sd\/- A<\/strong><br>(Drawer)<\/p>\n<\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-types-of-bills-of-exchange\"><span class=\"ez-toc-section\" id=\"Types_of_Bills_of_Exchange\"><\/span>Types of Bills of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Bills of Exchange can be classified based on payment terms, nature, or purpose. Let\u2019s look at the major types:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Type<\/strong><\/td><td><strong>Description<\/strong><\/td><\/tr><tr><td><strong>Inland Bill<\/strong><\/td><td>Drawn and payable within the same country.<\/td><\/tr><tr><td><strong>Foreign Bill<\/strong><\/td><td>Drawn in one country and payable in another.<\/td><\/tr><tr><td><strong>Trade Bill<\/strong><\/td><td>Drawn for business purposes, usually arising out of a credit sale.<\/td><\/tr><tr><td><strong>Accommodation Bill<\/strong><\/td><td>Drawn not against a sale but to provide financial help between parties.<\/td><\/tr><tr><td><strong>Demand Bill<\/strong><\/td><td>Payable immediately upon presentation.<\/td><\/tr><tr><td><strong>Time Bill<\/strong><\/td><td>Payable after a certain period from the date or sight.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-16018d1d wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.oliveboard.in\/upsc-epfo-eo\/?ref=conttm-aib&amp;next=https:\/\/u1.oliveboard.in\/exams\/?c=epfoeo&amp;i=epfoeo#mtestdata\" target=\"_blank\" rel=\"noreferrer noopener\">attempt UPSC EPFO APFC + EO\/AO Mock tests<\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-key-terms-related-to-bills-of-exchange\"><span class=\"ez-toc-section\" id=\"Key_Terms_Related_to_Bills_of_Exchange\"><\/span>Key Terms Related to Bills of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Before recording entries, understanding these key terms helps in interpreting how bills operate in real transactions.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Term<\/strong><\/td><td><strong>Meaning<\/strong><\/td><\/tr><tr><td><strong>Date of Bill<\/strong><\/td><td>The date on which the bill is drawn.<\/td><\/tr><tr><td><strong>Term of Bill<\/strong><\/td><td>The period after which the bill becomes due for payment.<\/td><\/tr><tr><td><strong>Due Date<\/strong><\/td><td>The date on which payment is to be made (includes 3 days of grace).<\/td><\/tr><tr><td><strong>Days of Grace<\/strong><\/td><td>Additional 3 days allowed to the drawee for making payment.<\/td><\/tr><tr><td><strong>Maturity Date<\/strong><\/td><td>The final date after including days of grace when the bill must be paid.<\/td><\/tr><tr><td><strong>Endorsement<\/strong><\/td><td>The process of transferring the right to receive payment to another person by signing on the back of the bill.<\/td><\/tr><tr><td><strong>Discounting<\/strong><\/td><td>Selling the bill to a bank before the due date for immediate cash, less discount.<\/td><\/tr><tr><td><strong>Dishonour of Bill<\/strong><\/td><td>When the drawee fails to make payment on the due date.<\/td><\/tr><tr><td><strong>Noting Charges<\/strong><\/td><td>Fees paid to a notary public for noting dishonour.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-accounting-treatment-of-bills-of-exchange\"><span class=\"ez-toc-section\" id=\"Accounting_Treatment_of_Bills_of_Exchange\"><\/span>Accounting Treatment of Bills of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>When a bill is drawn, accepted, and either retained, discounted, or endorsed, different journal entries are passed.<br>Below is a summary of common accounting treatments in the books of the drawer and drawee.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-a-when-bill-is-drawn-and-accepted\">(A) When Bill is Drawn and Accepted<\/h3>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>In Drawer\u2019s Books<\/strong><\/td><td><strong>In Drawee\u2019s Books<\/strong><\/td><\/tr><tr><td>Bills Receivable A\/c Dr.<\/td><td>To Drawee\u2019s A\/c<\/td><\/tr><tr><td>Drawer\u2019s A\/c Dr.<\/td><td>To Bills Payable A\/c<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-b-when-bill-is-discounted-with-bank\">(B) When Bill is Discounted with Bank<\/h3>\n\n\n\n<p>In this case, the drawer receives cash immediately, but at a discount.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Entry<\/strong><\/td><td><strong>Account<\/strong><\/td><\/tr><tr><td>Bank A\/c Dr.<\/td><td>To Bills Receivable A\/c<\/td><\/tr><tr><td>Discount A\/c Dr.<\/td><td>(with discount amount)<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-c-when-bill-is-endorsed-to-a-creditor\">(C) When Bill is Endorsed to a Creditor<\/h3>\n\n\n\n<p>If the drawer transfers the bill to his creditor to settle a debt:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Entry<\/strong><\/td><td><strong>Account<\/strong><\/td><\/tr><tr><td>Creditor\u2019s A\/c Dr.<\/td><td>To Bills Receivable A\/c<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-16018d1d wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-text-align-center wp-element-button\" href=\"https:\/\/www.oliveboard.in\/upsc-epfo-eo\/?ref=conttm-aib&amp;next=https:\/\/u1.oliveboard.in\/exams\/?c=epfoeosec&amp;i=epfoeo\" target=\"_blank\" rel=\"noreferrer noopener\">Attempt Sectional mock tests for UPSC EPFO APFC + EO\/AO<\/a><\/div>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-d-when-bill-is-dishonoured\">(D) When Bill is Dishonoured<\/h3>\n\n\n\n<p>If the bill is not paid on due date:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>In Drawer\u2019s Books<\/strong><\/td><td><strong>In Drawee\u2019s Books<\/strong><\/td><\/tr><tr><td>Drawee\u2019s A\/c Dr.<\/td><td>To Bills Receivable A\/c<\/td><\/tr><tr><td>Bills Payable A\/c Dr.<\/td><td>To Drawer\u2019s A\/c<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-importance-of-bills-of-exchange\"><span class=\"ez-toc-section\" id=\"Importance_of_Bills_of_Exchange\"><\/span>Importance of Bills of Exchange<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Bills of Exchange play a crucial role in trade and commerce. They formalize credit transactions and ensure legal enforceability of payments.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Provides security of payment to the seller.<\/li>\n\n\n\n<li>Facilitates credit transactions between parties.<\/li>\n\n\n\n<li>Can be discounted with banks to meet cash needs.<\/li>\n\n\n\n<li>Serves as legal evidence of debt.<\/li>\n\n\n\n<li>Enables smooth business operations and builds trust between buyers and sellers.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-difference-between-bill-of-exchange-and-promissory-note\"><span class=\"ez-toc-section\" id=\"Difference_Between_Bill_of_Exchange_and_Promissory_Note\"><\/span>Difference Between Bill of Exchange and Promissory Note<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Before studying promissory notes in detail, it\u2019s useful to compare them with bills of exchange to understand their distinct legal nature.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Basis<\/strong><\/td><td><strong>Bill of Exchange<\/strong><\/td><td><strong>Promissory Note<\/strong><\/td><\/tr><tr><td><strong>Number of Parties<\/strong><\/td><td>Three \u2013 Drawer, Drawee, Payee<\/td><td>Two \u2013 Maker and Payee<\/td><\/tr><tr><td><strong>Nature<\/strong><\/td><td>Contains an order to pay<\/td><td>Contains a promise to pay<\/td><\/tr><tr><td><strong>Acceptance<\/strong><\/td><td>Requires acceptance by drawee<\/td><td>No acceptance required<\/td><\/tr><tr><td><strong>Drawn By<\/strong><\/td><td>Creditor<\/td><td>Debtor<\/td><\/tr><tr><td><strong>Liability<\/strong><\/td><td>Drawer is secondarily liable<\/td><td>Maker is primarily liable<\/td><\/tr><tr><td><strong>Use<\/strong><\/td><td>Used mostly in trade transactions<\/td><td>Used in borrowings or loans<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-faqs\"><span class=\"ez-toc-section\" id=\"FAQs\"><\/span>FAQs<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong>Q1. What is a Bill of Exchange?<\/strong><\/p>\n\n\n\n<p>A1: It is a written, unconditional order directing a person to pay a specific amount to another person or to the bearer.<\/p>\n\n\n\n<p><strong>Q2. Who are the three parties to a Bill of Exchange?<\/strong><\/p>\n\n\n\n<p>A2: the three parties to a Bill of Exchange are- Drawer, Drawee, and Payee.<\/p>\n\n\n\n<p><strong>Q3. What is the difference between an Inland and a Foreign Bill?<\/strong><\/p>\n\n\n\n<p>A3: An Inland Bill is drawn and payable within the same country, whereas a Foreign Bill involves two different countries.<\/p>\n\n\n\n<p><strong>Q4. What happens if a bill is dishonoured?<\/strong><\/p>\n\n\n\n<p>A4: The drawee fails to pay, and the amount is reversed in the drawer\u2019s books. The drawer may recover it with noting charges.<\/p>\n\n\n\n<p><strong>Q5. What are Days of Grace?<\/strong><\/p>\n\n\n\n<p>A5: Three additional days allowed beyond the due date for the drawee to make payment.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n<ul class=\"wp-block-latest-posts__list is-grid columns-3 wp-block-latest-posts\"><li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/www.oliveboard.in\/blog\/upsc-epfo-exam-analysis-2025\/\">UPSC EPFO Exam Analysis 2025, 30th November, Difficulty Level &amp; Good Attempts<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/www.oliveboard.in\/blog\/upsc-epfo-admit-card\/\">UPSC EPFO Admit Card 2025 Out, APFC &amp; EO\/AO Hall Ticket Link<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/www.oliveboard.in\/blog\/industrial-relations-and-labour-laws-notes-upsc-epfo-eo\/\">Industrial Relations &#038; Labour Laws Notes for UPSC EPFO 2025, Free PDF<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/www.oliveboard.in\/blog\/upsc-epfo-air-1s-journey-strategy\/\">UPSC EPFO Topper&#8217;s Strategy, AIR 1&#8217;s Journery and Success Story<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/www.oliveboard.in\/blog\/upsc-epfo-posting\/\">UPSC EPFO Posting for EO\/AO &amp; APFC: Transfers &amp; Growth<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/www.oliveboard.in\/blog\/upsc-epfo-exam-date-2025-out\/\">UPSC EPFO Exam Date 2025, Admit Card Link for 230 Posts<\/a><\/li>\n<\/ul>\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n","protected":false},"excerpt":{"rendered":"<p>A Bill of Exchange is an important financial instrument used in business transactions to ensure payment between buyers and sellers.<\/p>\n","protected":false},"author":60,"featured_media":231022,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,10210,62,10321],"tags":[18115,11528],"class_list":["post-231016","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-epfo","category-government-exams","category-upsc-epfo","tag-bills-of-exchange","tag-upsc-epfo","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-50"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.6 (Yoast SEO v26.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Bills of Exchange: Meaning, Parties, Types &amp; Accounting Entries<\/title>\n<meta name=\"description\" content=\"Understand the Bills of Exchange and their role as important financial instruments in business transactions.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.oliveboard.in\/blog\/bills-of-exchange\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bills of Exchange: Meaning, Parties, Types &amp; Accounting Entries\" \/>\n<meta property=\"og:description\" content=\"A Bill of Exchange is an important financial instrument used in business transactions to ensure payment between buyers and sellers. 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