Questions on commercial paper

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Questions on commercial paper
What is the bill of exchange? What is the most important data to be available in it?
Among the questions that came to us from readers and followers, which revolve around commercial papers in financial accounting, are: What is a bill of exchange? What are the data that must be available in any bill of exchange?
This is what we will answer in detail in this new article on the "Program Idea" blog.
What is the definition of a bill of exchange?
A bill of exchange is a commercial paper that is used commercially for the purpose of borrowing part of the money and repaying it later within a period of time to be determined by agreement between the parties to the bill.
The bill of exchange is referred to as a triple paper, because it contains the names of three persons, and they are referred to in the bill as follows:
1. The first person: It is called the “drawer”, and it is the person who is the creditor or who lends the required amount of money.
2. The second person: He is called the "drawee", and he is the debtor who must pay the amount specified in the bill of exchange.
3. The third person: who is the “beneficiary” and is called that since he is the one who issued the bill of exchange in his favor.
What are the data that must be provided in the bill of exchange?
In order for the bill of exchange to be valid, valid, and reliable, it must contain a number of data that must be included in the bill, as follows:
The date of writing the bill of exchange.
due date.
Beneficiary Name.
The amount of money in letters and numbers
The method of payment of the agreed amount, whether in cash or goods.
The word "Bill of Exchange" must also appear on the paper.
In addition to these data, there are a number of important points that must also be available on the bill of exchange, as follows:
A bill of exchange must not contain more than one amount only.
Ensure that the amount of money is written in numbers and letters, and in the event of a discrepancy between them, the amount written in letters is considered the correct one.
In the event that the amount is written more than once in letters and numbers, the number with the least value is considered correct.
In the event that a time period is specified for the maturity of the bill, in this case it is possible to add interest to the amount of the bill and determine it therein.
The interest shall be effective from the date of writing the promissory note in the event that no other date is specified for it.
It is worth noting that we point out that if the debtor does not pay the amount due on time, the creditor may sue him.
In the event that three years or more pass without paying the bill of exchange, and the creditor does not take any action against the debtor within this period, then the bill falls from the debtor and becomes worthless and may not be sued for it.

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