Is Accounts Receivable Classified Under Liabilities And Equity?
Here we will study about “Is Accounts Receivable Classified Under Liabilities And Equity ”. You may also be interested in “ Is Accounts Receivable An Asset ” The answer to this Accounting Question is that Accounts Receivable is neither classified under Liabilities nor Equity but, in fact, Accounts Receivable is a Current Asset o n Balance Sheet which is convertible into Cash very quickly. Accounts Receivable is the amount of debts due from customers against the goods or services sold on credit / account basis. For Example, if the entrepreneur sold goods worth Rs. 50000 to Mr. A on Credit Basis and Mr. A agrees to make payment for the goods after 30 days, then it is a Business Transaction and it is related to Sale of goods on credit basis. The Customer, Mr. A is Accounts Receivable for the entrepreneur while Sales is the revenue which the entrepreneur will earn when the customer, Mr. A makes payment on due date. When the customer, Mr. A ma...