Welcome to today’s class!!
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In today’s Store Management’s class, we will be learning about Foreign Bill of Exchange
Foreign Bill of Exchange
As we have come to know: International Trade ensures we have goods made from other countries available in ours, such as having bags, shoes and medicine made in America, India and other countries sold in the markets.
We also discovered that for an international trade to succeed and go smoothly, there is a need for some documents to be made available and provided.
Today, we shall consider the role of Foreign Bill of Exchange in trade.
A Foreign Bill of Exchange transaction can involve up to three parties. The drawee is the party that pays the sum specified by the bill of exchange. The payee is the one who receives that sum. The drawer is the party that obliges the drawee to pay the payee.
The drawer and the payee are the same entity unless the drawer transfers the bill of exchange to a third-party payee.
It is also described to be a written order used primarily in international trade that binds one party to pay a fixed sum of money to another party on demand or at a predetermined date. Interestingly, Foreign Bills of Exchange are similar to checks and promissory notes—they can be drawn by individuals or banks and are generally transferable by endorsements.
The bill outlines a debtor’s indebtedness to a creditor. It’s frequently used in international trade to pay for goods or services. While a bill of exchange is not a contract itself, the involved parties can use it to fulfill the terms of a contract. It can specify that payment is due on demand or at a specified future date. It’s often extended with credit terms, such as 90 days. As well, a bill of exchange must be accepted by the drawee to be valid.
In summary, a Bill of Exchange outlines a debtor’s indebtedness to a creditor. It’s frequently used in international trade to pay for goods or services.
What is a Foreign Bill of Exchange
How is a Foreign Bill of Exchange Different From An Indent?
Explain two importance of a Foreign Bill of Exchange.
We hope you enjoyed today’s class. In our next class, we will be talking about
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