Accounts receivable: Is the money owed to a

Accounts receivable is the money owed to a business by customers for goods or services delivered on credit, reflecting future cash inflows. Accounts receivable represents funds owed to the business by customers for sales made. The accounts receivable department is responsible for collecting accounts receivables of a business and plays a major role in channelling revenue into the business. Hence, following the accounts, the receivable process helps maintain a healthy cash flow to support the business. Meaning of accounts receivable process The accounts receivable process consists of steps and practices that businesses adopt to ... Accounts Receivable (AR) represents the credit sales of a business, which have not yet been collected from its customers. Companies allow their clients to pay for goods and services over a reasonable extended period of time, provided that the terms have been agreed upon. Accounts receivables financing and factoring Bank loans and lines of credit: Businesses can use their accounts receivable as collateral to secure bank loans or lines of credit, providing immediate access to cash while waiting for customer payments. Factoring services: Factoring involves selling accounts receivable to a third-party financial institution at a discounted rate, enabling the business to receive immediate cash while the factor assumes the responsibility of collecting from ...