Multiple Choice
Overdrafting your checking account often indicates a sign of:
20
views
7. Receivables and Investments
Types of Receivables
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
It's your responsibility to know about all of the different types of receivables before choosing a bank. Which of the following is NOT considered a type of receivable in financial accounting?
A
Inventory Receivable
B
Accounts Receivable
C
Interest Receivable
D
Notes Receivable
Verified step by step guidance1
Understand the concept of receivables: In financial accounting, receivables are amounts owed to a business by its customers or other parties. They are considered assets because they represent future cash inflows.
Identify the common types of receivables: The main types of receivables include Accounts Receivable (amounts owed by customers for goods or services sold on credit), Notes Receivable (formal written promises to pay a specific amount at a future date), and Interest Receivable (interest income earned but not yet received).
Analyze the given options: Review each option to determine if it fits the definition of a receivable. Accounts Receivable, Interest Receivable, and Notes Receivable are all valid types of receivables in financial accounting.
Evaluate the term 'Inventory Receivable': Inventory is a physical asset representing goods held for sale, not a receivable. There is no such concept as 'Inventory Receivable' in financial accounting.
Conclude the answer: Based on the analysis, 'Inventory Receivable' is NOT considered a type of receivable in financial accounting.
Related Videos
Related Practice
Types of Receivables practice set
Problem sets built by lead tutorsExpert video explanations