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Bill of Exchange
distinguish between bill of exchange and promissor...

Question:
Distinguish between bill of exchange and promissory note.

Answer:

Bill of Exchange:

A 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.
There may be three parties- drawer, acceptor and payee.
It is drawn by the creditor.
It needs acceptance by the drawee.
The liability of the drawer is secondary.

Promissory Note:

A promissory note is a financial instrument that contains a written promise by one party (the note’s issuer or maker) to pay another party (the note’s payee) a definite sum of money, either on demand or at a specified future date.
There are only two parties- the maker who draws the note and sign it and the payee to whom the amount is payable.
It is drawn by the debtor.
It does not need acceptance.
The liability of the maker is primary.

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Mr. Sunrise started a business for buying and selling of stationery with ₹ 5,00,000 as an initial investment. Of which he paid ₹ 1,00,000 for furniture, ₹ 2,00,000 for buying stationery items. He employed a sales person and clerk. At the end of the month he paid ₹ 5,000 as their salaries. Out of the stationery bought he sold some stationery for ₹ 1,50,000 for cash and some other stationery for ₹ 1,00,000 on credit basis to Mr. Ravi. Subsequently, he bought stationery items of ₹ 1,50,000 from Mr. Peace. In the first week of next month there was a fire accident and he lost ₹ 30,000 worth of stationery. A part of the machinery, which cost ₹ 40,000, was sold for ₹ 45,000.

From the above, answer the following :
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2. What are the fixed assets he bought?
3. What is the value of the goods purchased?
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7. What is the loss he incurred?
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Question:
Distinguish between bill of exchange and promissory note.

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Question:
Distinguish between bill of exchange and promissory note.