Asked by Kennedy Willens on Jun 30, 2024
Verified
Accounts receivable can be the result of either cash or credit sales.
Accounts Receivable
Funds that are yet to be paid by customers for the products or services they have received from a business.
Credit Sales
Credit Sales are sales made on credit, where the payment is received after the sale has been made, effectively extending a line of credit to the customer.
- Recognize the distinction between accounts receivable and notes receivable, and their impact on financial statements.
Verified Answer
ZK
Zybrea KnightJul 03, 2024
Final Answer :
False
Explanation :
Accounts receivable arise from credit sales only, not cash sales, as they represent the amount of money owed to a company by its customers for goods or services delivered but not yet paid for.
Learning Objectives
- Recognize the distinction between accounts receivable and notes receivable, and their impact on financial statements.
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