Where Accounts Receivable and Payable are shown in Balance Sheet

Accounts receivable can be defined as money which is payable to a company by a customer for products and services provided on credit. In the balance sheet account receivable is treated as current asset and shown on asset side of balance sheet. (Current assets are those assets payment from which is likely to be realized during next 12 months.)

Accounts payable can be defined as money which is due but not paid by the company to its suppliers. In other word account payable is a form of credit that suppliers give to the company by allowing them to pay for a product or service after it has already been received. In the balance sheet it is treated as current liability and is shown on liabilities side of balance sheet. (Current liabilities are that liability that has to be paid during next 12 months.)

1 comment… add one
  • Ravi

    Very nice to the point explanations of most of the queries retail investor can have.
    Goog work…. keep posting more like special situations, arbitrage w.r.t warrants / pref shares etc.,

    Also how to see preference shares listed in bse?

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