Accounts Receivable represents the amount of revenue that is owed to a business. This is the direct result of a credit sale. Accounts receivable is an asset account and found on the balance sheet net of its allowance for doubtful accounts account. It is categorized as a current asset and collection is expected to take between 30-60 days.
Example: On January 15th, Adequate Disclosure, Inc. performs its bookkeeping services for Inadequate Disclosure, Inc. This year, Inadequate Disclosure, Inc. decides to pay by note worth $100,000. How will Adequate Disclosure, Inc. report this transaction on its balance sheet?
