Notes Receivable Are Reported on the Statement of Financial Position

question 203

True/False

Notes receivable are reported on the statement of financial position following accounts receivable because notes receivable give the payee a weaker legal claim to assets than accounts receivable.

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Definitions:

Accounts

Accounts refer to the records of financial transactions, reflecting credits and debits in the financial statements of a business or an individual.

General Ledger

A complete record of all the financial transactions of a company, organized by accounts, which provides the data used to create financial statements.

Chart of Accounts

An organized list of all the account titles and numbers used in the ledger of a company to classify transactions.

Transactions

Business activities or events that have a financial impact on the finances of a company, recorded in the accounting records.