1. An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its customers or debtors, including all debts – even if not yet due – owed to the company. They are also referred to as “accounts receivable.”
Even though the business does not have the money on hand, receivables are still considered assets. With the relative assurance that these receivables will be collected, businesses are able to use them as collateral when applying for short-term loans. Because some debt may not be paid back, however, most companies make an “allowance for doubtful accounts,” which slightly decreases their calculation of accounts receivable.
When accounting for assets, businesses may have separate columns for both cash on hand and receivables. Together, the two columns will reflect total assets, but an asset cannot be counted in two columns at once. An outstanding receivable cannot be counted as cash until it is actually paid by the customer. At that time it is moved from one column to the other.
2. Slang: A term coined by millennials to denote items that flow easily between friends, along with “giveables,” “shareables” and “borrowables.”
A cellphone retailer sells about half of its products to customers who buy them outright, and the other half to customers who take advantage of financing. The latter category is considered accounts receivable, but is still counted among the company’s assets.