What Is the Difference Between a Pledging of Accounts Receivable

question 4

Essay

What is the difference between a pledging of accounts receivable and a factoring of accounts receivable?

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Definitions:

Financial Statements

Summarized records of a company's financial activities and position, typically comprising the balance sheet, income statement, and cash flow statement.

Shareholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing the net assets held by shareholders.

General Journal

A general journal is an accounting ledger that is used to record all transactions of a business in chronological order, prior to their transfer into specific accounts in the general ledger.