The majority of businesses offer credit to their clients. That is, they promptly deliver the goods and services, send an invoice, and wait a few weeks to be paid. Businesses use an account in their books called accounts receivable to keep track of all the money their customers owe them.
The amount of money due to a company for goods or services delivered or utilized but not yet paid for by consumers is known as accounts receivable (AR). Accounts receivables are current assets on the balance sheet. Any sum owing by clients for purchases bought on credit is referred to as AR. Accounts receivable refers to a company's overdue bills or the money owed by customers. The term refers to accounts that a company is entitled to get as a result of delivering a product or service.
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