Which of the following statements regarding receivables is correct?
A) Each receivable transaction involves three parties.
B) Receivables occur when a business loans money to another party.
C) A receivable occurs when a business makes a cash sale of goods or services to another party.
D) A receivable is the right to pay cash in the future from a current receivable transaction.

Question

Quizplus · Accepted Answer

Receivables occur when a business extends credit to another party, not when it makes a cash sale.

Which of the Following Statements Regarding Receivables Is Correct