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 type of receivable is most likely associated with situations where lenders do not check a person's likelihood to repay before accepting a credit agreement?

Notes receivable

Credit card receivables

Accounts receivable

Nontrade receivables

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Understand the types of receivables listed in the problem: Notes receivable, Credit card receivables, Accounts receivable, and Nontrade receivables.

Notes receivable typically involve formal agreements where repayment terms are clearly defined, often including interest. These are usually associated with a higher level of scrutiny regarding the borrower's ability to repay.

Accounts receivable represent amounts owed by customers for goods or services provided on credit. These are generally tied to business transactions and may involve some level of creditworthiness assessment.

Nontrade receivables refer to receivables not related to the primary operations of a business, such as loans to employees or advances. These are often specific and may involve informal agreements.

Credit card receivables are associated with situations where lenders (credit card companies) often approve credit agreements without thoroughly checking the borrower's likelihood to repay. This is due to the widespread use of credit cards and the reliance on interest rates and fees to mitigate risk.