Accounts receivable consist of the credit of the business.It can take the form of which of the following?
A)I only
B)II only
C)Both I and IT
D)Neither I nor II

Question

Quizplus · Accepted Answer

I) Trade receivables: These are the receivables arising as a result of the sale of goods or services on credit. They are a significant source of working capital for many businesses.

II) Non-Trade receivables: These are the receivables that arise from non-sales transactions, such as loans to employees or advances to suppliers. They can also include interest, dividends, and rental income receivables.

Therefore, both trade and non-trade receivables form a part of accounts receivable.

Accounts Receivable Consist of the Credit of the Business