Chapter 8 Reporting and Analyzing Receivables Study Objectives Csulb Form

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hello and welcome back to our last learning objective of this chapter learning objective three accounting for notes receivable so a note receivable is a stronger legal claim than an accounts receivable because this is something that has a contract uh it's a contract that typically has interest and it typically goes for periods Beyond 30 days typically 60 90 perhaps 6 months or a year and this happens if we you know have a really long accounts receivable and we now have to say cool you um you need we need long like a stronger longer um contract because and we're going to charge you interest you may get some um collateral because you have extended beyond what we typically will uh work with people for regular accounts receivables um it may be set up for other reasons you may sell a piece of equipment to somebody and instead of receiving cash in exchange you may receive a promissary note so there's a couple different reasons why you might receive a note receivable uh AKA promiser note to r