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 type of receivable is created when a company deposits money in a bank that is a member of the FDIC?

Notes Receivable

Cash (Bank Deposit)

Trade Receivable

Other Receivable

Previous problemNext problem

Verified step by step guidance

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

Analyze the options provided: Notes Receivable refers to formal written promises to pay a specific amount, Trade Receivable arises from sales of goods or services, and Other Receivable includes miscellaneous receivables not classified elsewhere.

Focus on the scenario described: When a company deposits money in a bank, it is not creating a receivable. Instead, it is recording an asset in the form of Cash (Bank Deposit).

Recognize the role of FDIC: The Federal Deposit Insurance Corporation (FDIC) insures deposits in member banks, ensuring the safety of the deposited funds. This does not create a receivable but rather secures the cash asset.

Conclude that none of the receivable types listed (Notes Receivable, Trade Receivable, Other Receivable) are applicable to this situation. The correct classification is Cash (Bank Deposit), which is an asset, not a receivable.