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 typically used to store funds that are not intended for daily operating expenses?

Accounts receivable

Sinking fund receivables

Notes receivable

Trade receivables

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Verified step by step guidance

Understand the concept of receivables: Receivables are amounts owed to a company by its customers or other parties. They are classified into different types based on their purpose and nature.

Define sinking fund receivables: Sinking fund receivables are funds set aside for a specific purpose, such as repaying debt or replacing assets, and are not intended for daily operating expenses.

Compare sinking fund receivables with other types: Accounts receivable, notes receivable, and trade receivables are typically related to daily business operations, such as sales or loans, whereas sinking fund receivables are reserved for long-term financial goals.

Identify the correct answer: Based on the definition and purpose, sinking fund receivables are the type of receivables used to store funds that are not intended for daily operating expenses.

Conclude the reasoning: The correct answer is sinking fund receivables because they are specifically designated for purposes beyond regular operational needs, unlike the other types listed.