Final answer:
A company with an account receivable or a note receivable has provided credit to customers or loans, which are assets on the balance sheet signaling money owed to the company.
Step-by-step explanation:
A company that has either an account receivable or a note receivable on its books indicates that it has extended credit to its customers in the form of goods or services provided but not yet paid for, or it has provided a loan that will be repaid in the future. These instruments are part of a company's assets on its balance sheet and represent a legal obligation for customers to pay the firm. Account receivable typically refers to the money that customers owe the company for purchasing its products or services on credit, usually due within a short time period such as 30 to 90 days. A note receivable often involves a more formalized loan agreement, sometimes secured by collateral, and usually including interest, with repayment terms that might extend over a longer period.