![]() Does accounts receivable count as revenue?Īccounts receivable is an asset account, not a revenue account. You (or your bookkeeper) record it as an account receivable on your end, because it represents money you will receive from someone else. When Keith gets your invoice, he’ll record it as an accounts payable in his general ledger, because it’s money he has to pay someone else. Let’s say you send your friend Keith’s business, Keith’s Furniture Inc., an invoice for $500 in exchange for a logo you designed for them. Though lenders and investors consider both of these metrics when assessing the financial health of your business, they’re not the same.Īccounts receivable are an asset account, representing money that your customers owe you.Īccounts payable on the other hand are a liability account, representing money that you owe another business. What’s the difference between accounts receivable and accounts payable? Your general ledger will show your total accounts receivable balance, but to dig into outstanding payments by individual customers, you’ll usually need to refer to the accounts receivable subsidiary ledger. (In this case, in the form of a future cash payment.) Accounts receivable are classified as an asset because they provide value to your company. You can find your accounts receivable balance under the ‘current assets’ section on your balance sheet or general ledger.
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