Accounting and Bookkeeping
Accounts receivable (AR) are monies owed to the organization by another party. Typically, accounts receivable are recorded when services are rendered to earn revenue for the organization or promises to give are received by the organization. Promises to give are typically not recorded unless there is a signed pledge card or award letter stating the amount being promised and an approximate time period under which it will be paid. Below are example journal entries for accounts receivable.
The receipt of an accounts receivable item is typically reflected in a deposit made to your cash account. When you have accounts receivable, it is vital to review it before assigning revenue accounts to your deposits to make sure you remove any accounts receivable you have so you do not double count revenue.