Accounts receivable will appear on which of the following financial statements?
Statement of changes in stockholders’ equity
Statement of cash flows
Balance sheet
Income statement
Balance sheet
Accounts receivable will appear on the Balance sheet.
To determine the answer to this question, you need to understand the nature of accounts receivable and its purpose in financial statements. Accounts receivable represents the money owed to a company by its customers or clients for goods or services provided on credit. It is considered a current asset as it is expected to be collected within one year.
The Balance sheet is one of the primary financial statements that presents a snapshot of a company's financial position at a given point in time. It consists of three main sections: assets, liabilities, and equity. Accounts receivable falls under the assets section as a current asset.
The other financial statements listed in the question are not the appropriate statements to show accounts receivable:
- The Statement of changes in stockholders' equity shows the changes in a company's equity during a specific period, including contributions, earnings, and dividends. It does not include accounts receivable.
- The Statement of cash flows provides information about the cash inflows and outflows from operating, investing, and financing activities. While accounts receivable may impact the cash flows, it does not directly appear on this statement.
- The Income statement, also known as the Profit and Loss statement, presents a company's revenues, expenses, gains, and losses over a specific period. Accounts receivable does not appear on this statement, although it may indirectly affect revenue if the company does not collect the amounts owed.
Therefore, the correct answer is that accounts receivable will appear on the Balance sheet.