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 is classified as an account receivable?

Amounts owed by customers for goods sold on credit

Advances to suppliers

Loans made to employees

Interest receivable from investments

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Verified step by step guidance

Understand the concept of accounts receivable: Accounts receivable refers to amounts owed to a company by its customers for goods or services provided on credit. It represents a claim for payment and is classified as a current asset on the balance sheet.

Analyze the first option: 'Amounts owed by customers for goods sold on credit.' This fits the definition of accounts receivable because it represents money owed by customers for goods sold on credit.

Evaluate the second option: 'Advances to suppliers.' This does not qualify as accounts receivable because it represents payments made in advance to suppliers, not amounts owed by customers.

Examine the third option: 'Loans made to employees.' This is not accounts receivable because it represents loans given to employees, not amounts owed by customers for goods or services.

Review the fourth option: 'Interest receivable from investments.' This is not accounts receivable because it represents interest income earned on investments, not amounts owed by customers for goods or services.