Definition

Accounts receivable

Accounts receivable are amounts owed by customers on account. They result from the sale of goods and services. Companies generally expect to collect these receivables within 30 to 60 days. Accounts receivable are the most significant type of claim held by a company.

Three accounting issues associated with accounts receivable are:

1. Recognizing accounts receivable.

2. Valuing accounts receivable.

3. Disposing of accounts receivable.

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