Accounts Receivable (AR)
Accounting glossary · Understand, connect, apply
Accounts receivable are amounts an entity has a right to collect from customers, usually for goods or services supplied on credit.
Example
A $900 credit sale creates a receivable; collecting $900 later reduces that receivable and increases Cash.
Remember the difference
A receivable is not certain cash. Assess collectability and any required credit-loss allowance.
Updated 3 November 2026. Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
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