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Accounts Receivable

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Keeping track of Accounts Receivable

Image (c) Mark Langridge / Getty Images

Definition:

In the accounting system, the entries in the accounts receivable ledger represent amounts of money you are owed. These amounts are usually the result of the sale of assets or for services you have provided.

A separate accounts receivable ledger is used if your business sells to customers on credit.

Also Known As: A current asset on your balance sheet.

Common Misspellings: Acounts receivable; accounts recievable.

Examples: A customer who purchases your product on credit would be listed in your accounts receivable ledger. This ledger would list each customer by name alphabetically, and contain a running total of his or her charges.

See also:

Debt Management - Accounts Receivable

Accounts Receivables Management - Basic Financial Management

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