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What is accounts receivable?

It is nothing but the amount that your customers owe to you in a short period of time for the goods or services they receive on credit. Accounts receivable is recorded as the current asset on your balance sheet. This is because you are liable to receive cash against such receivables in less than one year.

What is accounts receivable (AR)?

Accounts receivable (AR) is the balance of money due to a firm for goods or services delivered or used but not yet paid for by customers. Accounts receivable is listed on the balance sheet as a current asset. Any amount of money owed by customers for purchases made on credit is AR.

What is an accounts receivable line item?

Under accrual accounting, the accounts receivable line item, often abbreviated as “A/R”, refers to payments not yet received by customers that paid using credit rather than cash. Conceptually, accounts receivable reflects a company’s total outstanding (or unpaid) customer invoices.

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