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Quick Guide to Receivables

Receivables, also known as accounts receivable, are money that is owed to a company for goods or services that were provided on the basis of credit. Accounts receivable are considered an asset to the company to which the money should be paid. This is because receivables represent a legal obligation for a customer to repay their short-term loans.

Receivables held by a company means that the company has made a sale but is waiting for payment from the customer. Companies with receivables allow sales to be made on credit. These types of sales are usually made to customers who are periodically invoiced for frequent purchases, which can alleviate the hassle of having to pay for each individual transaction.