Sellers generally prefer to receive notes receivable rather than accounts receivable when the credit period is long and the receivable is for a large amount.

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This is because notes receivable are legally binding and generally have a longer term than accounts receivable, making them less risky for the seller. Additionally, notes receivable provide more evidence of the debtor's commitment to paying back the debt, which can be helpful if legal action needs to be taken in case of default.

Sellers Generally Prefer to Receive Notes Receivable Rather Than Accounts