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

Previous problemNext problem

Struggling with Financial Accounting?

Join thousands of students who trust us to help them ace their exams!Watch the first video

Multiple Choice

Which of the following best describes a bank overdraft in the context of types of receivables?

A liability representing the amount by which withdrawals from a bank account exceed the available balance.

An asset representing amounts owed by customers for goods or services sold.

A non-trade receivable resulting from sales made on credit.

A note receivable that earns interest over time.

Previous problemNext problem

Verified step by step guidance

Understand the concept of a bank overdraft: A bank overdraft occurs when withdrawals from a bank account exceed the available balance, creating a negative balance. This represents an obligation to the bank, making it a liability.

Analyze the options provided: The question asks which description best fits a bank overdraft. Carefully read each option and compare it to the definition of a bank overdraft.

Option 1: 'A liability representing the amount by which withdrawals from a bank account exceed the available balance.' This matches the definition of a bank overdraft, as it describes the situation where the account holder owes money to the bank.

Option 2: 'An asset representing amounts owed by customers for goods or services sold.' This describes accounts receivable, which is unrelated to a bank overdraft.

Option 3: 'A non-trade receivable resulting from sales made on credit.' This refers to receivables not related to the primary operations of a business, which is also unrelated to a bank overdraft. Option 4: 'A note receivable that earns interest over time.' This describes a formal agreement to receive payment with interest, which is not relevant to a bank overdraft.