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Why is it important to maintain individual account receivable balances?
Wiki User
∙ 9y ago
Individual account receivable balances show each person (or company's) balance owed to the company. You must keep all individual account receivable balances accurate in order to know who owes what to you.
For example you general AR balance shows you are owed $5,000, this doesn't show you "who" owes you that amount or how much each person owes. Say John Doe owes you $1500 and Suzie Q owes you $2,000 that accounts for $3,500 of the AR you are owed, but doesn't account for the remaining balance of $1500. Without proper individual AR accounts you wouldn't have a record of who owes what and could either end up trying to over charge someone or losing money if you don't know how owes you so that you can invoice them for the correct amount.
Wiki User
∙ 9y ago
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What does accounts receivable factoring entail?
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