Receivables

/rɪˈsiːvəbəlz/ noun

Definition

Money owed to a company by its customers for goods sold or services provided on credit. Also called accounts receivable, these represent the company's legal claim to payment and are recorded as current assets on the balance sheet until collected.

Etymology

From Old French 'receivre' (to receive), ultimately from Latin 'recipere' (re- + capere, to take). The accounting term emerged in the 19th century as credit sales became common in business. The plural form reflects the multiple individual customer accounts that comprise this category.

Kelly Says

Receivables are like IOUs from your customers - they're promises of money that you can't spend yet! The challenge is that receivables are assets on paper but can become liabilities in reality if customers don't pay, which is why smart businesses track them like hawks.

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