Chapter 10. Other Receivables
The most common receivables are Accounts receivable. Accounts receivable arise when a company makes a sale on credit and thus is owed money by the customer. There are other types of receivables as well. Instead of making a sale, a company can make a loan to another entity and get a note in return. A note is a formal legal document that sets forth the terms of the loan.
The note should say who is making the loan (the maker), who is getting the loan (the debtor), the date of the loan, the amount of the loan (also called the face amount or the princpal), when the loan needs to be repaid (the maturity date)or the term of the loan (usually expressed in days or months), and the interest rate.
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