What is The Difference Between Rent Received And Rent Receivable

Rent received is the amount of revenue or income earned by the owner or landlord against the services rendered to tenant during the accounting period. It is recorded in Income Statement as it is a temporary account which has life equal to or less than one year. When, the payment received (either through cash or by cheque / check) by the business , we debit cash account or bank account and credit rent received account.

Rent Receivable is a Current Asset as it is a receivable from tenant for the facilities rendered to him but still the payment is not received from tenant by landlord during the accounting period. It is shown on balance sheet as it is a permanent account. When the full amount is receive, we debit cash account or bank account and credit rent receivable account.