What does accounts receivable mean on the CPA exam?
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Accounts receivable. Amounts customers owe for goods or services already delivered. An asset, reported net of the allowance for amounts not expected to be collected.
Defined against ASC 310-10.
Which CPA exam sections use accounts receivable?
Accounts receivable appears in the FAR section of the CPA exam.
Related terms
- transaction price: The consideration an entity expects to be entitled to for transferring goods or services, excluding amounts collected for third parties such as sales tax.
- allowance for credit losses: The amount set aside for receivables not expected to be collected, estimated over the whole expected life of the asset rather than only once a loss is probable.
- temporary difference: A difference between the tax basis of an asset or liability and its reported amount that will produce taxable or deductible amounts in future years.
- contract asset: The right to consideration for goods or services already transferred, where the right still depends on something other than the passage of time.
- contract liability: The obligation to transfer goods or services for which the customer has already paid, or for which payment is unconditionally due.
- additional paid-in capital: Amounts received from shareholders above the par or stated value of the shares issued, reported as a separate equity caption.