Question

Receivables represent a company's claims to the future collection of

a. Services
b. Cash
c. Other assets
d. Other liabilities

Answer 1

Receivables are claims to the future collection of cash and are considered an asset on a company's balance sheet.

Step-by-step explanation:

Receivables represent a company's claims to the future collection of cash. This is because receivables are amounts owed to the company by customers who have purchased goods or services on credit. The concept of receivables is summarized on a company's balance sheet, which is an accounting tool that lists assets and liabilities.

Receivables are considered an asset because they represent money that will flow into the company. An asset-liability time mismatch can occur in financial institutions, such as banks, where customers can withdraw a bank's liabilities (like deposits) in the short term while customers repay its assets (like loans) in the long term.