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Bills are of two types : Bills receivable and Bills payble.....Bill payable is a liability...A bill is drawn by the drawer and the person who has to borne the liability is called the payee or drawee.....Bill can be termly...for e.g. The drawer draws a bill upon the drawee for 3 months..or T months etc.. Now debts arise when a person is obliged to someone...Mostly debt arises in trading transactions...e.g. A trader purchases goods from a seller and promises him to pay certain amount after some time...Thus it is a credit purchase ...here the trader is in a position of debt...... Now considering the same position the seller will draw a BILL upon the TRADER who is in DEBT or indebted.

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13y ago

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