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

You need to track everything that involves money, including which of the following types of receivables?

Only prepaid expenses

Only cash and inventory

Only accounts payable

Accounts receivable, notes receivable, and other receivables

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Verified step by step guidance

Understand the concept of receivables: Receivables represent amounts owed to a business by customers or other parties. They are considered assets because they are expected to bring future economic benefits.

Identify the types of receivables: The main types of receivables include accounts receivable (amounts owed by customers for goods or services provided on credit), notes receivable (formal written promises to pay a specific amount at a future date), and other receivables (such as interest receivable, tax refunds, or loans to employees).

Differentiate receivables from other financial items: Prepaid expenses, cash, inventory, and accounts payable are not classified as receivables. Prepaid expenses are payments made in advance for future benefits, cash is a liquid asset, inventory represents goods held for sale, and accounts payable are liabilities owed to suppliers.

Recognize the importance of tracking receivables: Proper tracking ensures accurate financial reporting, helps monitor customer payment behavior, and supports effective cash flow management.

Apply this understanding to the problem: The correct answer is accounts receivable, notes receivable, and other receivables because these are the types of receivables that involve tracking money owed to the business.