Bills Receivable Book
Also known as a B/R book, bills receivable book is a subsidiary or secondary book of accounting, where all bills of exchange, which are receivable for the business, are recorded. The total value of all the bills receivable for an accounting period is transferred to the books of accounts.
In a mid to large sized business where the number of bills exchanging hands is large in number, it is tough to journalize all receipt of bills. All the bills are entered in an accounting ERP or a register depending on the business, furthermore, all these entries are transferred to the respective ledger accounts at a regular interval.
Bills receivable account will usually have a debit balance. As a bill receivable is supposed to be received at maturity, it acts as a current asset for the business. Generally, every bill has a 3 day grace period.
Sample Format of the B/R Book
A person who draws the bill of exchange is called a “drawer” and a customer on whom it is drawn is called a “drawee” or an “acceptor”. A bill receivable for a “drawer” is a bill payable for a “drawee”.
Short Quiz for Self-Evaluation
>Related Long Quiz for Practice Quiz 10 – Accounts Receivable – Intermediate
>Read What are Final Accounts?