Notes Receivable differ from Accounts Receivable in that Notes Receivable:
A)generally charge interest from the day they are signed to the day they are collected.
B)are noncurrent assets.
C)do not have to be created for every new transaction,so they are used more frequently.
D)are generally considered a weaker legal claim.

Question

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A note receivable is created when a formal written contract ("note")is established outlining the terms by which a company will receive amounts it is owed.Notes receivable differ from accounts receivable in that notes generally charge interest from the day they are signed to the day they are collected.Notes receivable are viewed as a stronger legal claim than accounts receivable,but a new note needs to be created for every transaction,so they are used less frequently.

Notes Receivable Differ from Accounts Receivable in That Notes Receivable