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

Which of the following types of receivables is NOT typically classified as ordinary income for financial accounting purposes?

Accounts receivable from sales of goods

Trade receivables from providing services

Interest receivable on investments

Notes receivable from lending activities

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Verified step by step guidance

Understand the concept of ordinary income: Ordinary income refers to income earned through the primary operations of a business, such as selling goods or providing services.

Analyze the types of receivables listed: Accounts receivable from sales of goods and trade receivables from providing services are directly related to the core business activities and are classified as ordinary income.

Consider the nature of interest receivable on investments: Interest receivable arises from investment activities, which are not part of the primary operations of a business. Therefore, it is not classified as ordinary income but rather as investment income.

Review notes receivable from lending activities: Notes receivable typically result from lending activities, which may or may not be part of the core business operations. If lending is not a primary business activity, this would not be classified as ordinary income.

Conclude that interest receivable on investments is the correct answer because it is derived from investment activities rather than the ordinary operations of selling goods or providing services.