Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

7. Receivables and Investments

Types of Receivables

Financial Accounting

7. Receivables and Investments

Types of Receivables

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Multiple Choice

Suppose Robina Bank receives a deposit from a customer. Which type of receivable does this transaction most likely create for Robina Bank?

Notes Receivable

Interest Receivable

None; deposits are not considered receivables for the bank

Accounts Receivable

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Verified step by step guidance

Understand the nature of the transaction: A deposit made by a customer to a bank is not a receivable for the bank. Instead, it represents a liability because the bank owes the deposited amount back to the customer upon request or at a future date.

Clarify the concept of receivables: Receivables are amounts owed to a business or entity by others, typically arising from sales or lending activities. Examples include Notes Receivable (formal written promises to pay) and Accounts Receivable (amounts due from customers for goods or services).

Analyze the options: Notes Receivable and Accounts Receivable are not applicable here because the bank is not owed money by the customer. Interest Receivable would apply only if the bank is owed interest, which is not the case in this scenario.

Identify the correct classification: Deposits are classified as liabilities for the bank because they represent an obligation to return the funds to the customer. They are not considered receivables.

Conclude: The correct answer is 'None; deposits are not considered receivables for the bank,' as deposits create a liability, not a receivable.