Ch. 9 Receivables Part 1 Quiz
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Accounts Receivable Turnover measures
how frequently during the year the accounts receivable are converted to cash
The number of days' sales in receivables
is an estimate of the length of time the receivables have been outstanding
A note receivable or promissory note
may be used to settle an accounts receivable.
Receivables are usually listed in order
of liquidity
A note receivable can be sold to a financial institution to secure cash before the maturity date. This type of transaction is called discounting the note receivable.
True
Both Accounts Receivable and Notes Receivable represent claims that are expected to be collected in cash.
True
Notes or accounts receivables that result from sales transactions are often called
trades receivables
