Nontrade receivables, such as deposits with utility companies or advances to subsidiary companies, should be

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Nontrade receivables should be recorded in separate accounts and separately reported on the balance sheet, as they represent a different type of asset from trade receivables. This allows users of the financial statements to better understand the composition of the company's assets and the nature of its financial obligations. Mixing nontrade and trade receivables in one account could lead to confusion and make it more difficult to analyze the company's financial position.

Nontrade Receivables, Such as Deposits with Utility Companies or Advances