Double Entry Accounting Software

Accounts receivables can be defined as the amount of money or cash that is to be received by the company from another party. Accounts receivables are considered as the assets of the company and are listed on the debit side of the balance sheet. In order analyze accounts receivable we must know a few things about them. These things include:-

The size of account receivable

The logical return associated with the doubtful accounts

With the help of the size of the account receivable we came to know that how much cash a company has invested in the form of accounts receivable. The company should invest in an account receivable with sensibility and limitations as these accounts do not return anything beyond the discount period. If a company is involved in selling product on credit the account receivable are considered to be an investment that is involving a brief delay between the delivery of the products and the stipulation of the services.

Although it is a good sign investing in account receivable but the over investment in account receivable can result in negative affect over the company. An optimal and precise level of account receivable is always in the favor of the company. In order to analyze the investment policy regarding accounts receivable a company must analyze the following factors such as the terms and conditions of the credit policy of the company, the credit limits assigned to the buyers, discounts offered on the cash payments, the rate of interest charged on the overdue payments. Some parameters that are used for the analysis of accounts receivable involve accounts receivable as a percentage of sales and the collection period of the average account receivables.

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• List of accounting softwares