Is Accounts Receivable A Current Asset?
Previously, we discussed about “ Is Accounts Receivable An Asset ” but here we are concerned with the very basic question, “Is Accounts Receivable A Current Asset”? in Accounting. The answer to this question is "Yes", because Accounts Receivable is the amount of debts due from customers in very near future which is convertible into cash very quickly. The future cash payment received from customers provides benefits to the business within the Current Accounting Period or Accounting Cycle. Accounts Receivable is also known as Debtor. Accounts Receivable basically is a Current Asset but due to its quick Liquidity, it is the part of Quick Assets since these types of assets are convertible into cash very quickly. You may also be interested in " Quick Ratio Definition " For Example, if the Entrepreneur sold goods worth Rs. 40000 To Customer, Mr. A, then Mr. is the Account Receivable for the company because the custome...