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Accounting Treatment

A promissory note is treated as a bill receivable by the person who is entitled to receive the money (the payee) and as a bill payable by the person who is liable to pay the money (the maker).

A bill of exchange is treated as a bill receivable by the person who is entitled to receive the money (the drawer) and as bill payable by the person who is to pay the money (the drawee).

The accounting entries for promissory note transactions are passed in the same manner as in case of bill of exchange.





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