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 to be unsecured?

Notes receivable secured by collateral

Bonds receivable

Mortgage receivable

Accounts receivable

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Verified step by step guidance

Understand the concept of receivables: Receivables are amounts owed to a business by customers or other entities. They can be classified into different types, such as accounts receivable, notes receivable, bonds receivable, and mortgage receivable.

Learn about secured vs. unsecured receivables: Secured receivables are backed by collateral, meaning there is an asset pledged to ensure repayment. Unsecured receivables, on the other hand, are not backed by any collateral and rely solely on the debtor's promise to pay.

Analyze the characteristics of each type of receivable: Notes receivable secured by collateral, bonds receivable, and mortgage receivable are typically secured because they involve formal agreements and often have assets pledged as collateral. Accounts receivable, however, are usually unsecured because they arise from routine credit sales and do not involve collateral.

Recognize why accounts receivable are unsecured: Accounts receivable represent amounts owed by customers for goods or services provided on credit. These transactions are based on trust and the customer's creditworthiness, without requiring collateral.

Conclude that accounts receivable are the most likely type of receivable to be unsecured, as they are not backed by collateral and are common in day-to-day business operations.