Trade Debtors in Accounts Receivables
A trade debtor is an entity that owes money to another entity because of buying goods or services on credit. Trade debtors are also known as accounts receivable. Accounts receivable are the money owed to a company by its customers. Money that is owed to a company is classified as an asset on the company’s balance sheet. Accounts receivable is one of the most important assets of a company because it represents money that will be coming into the company. Accounts receivable are also an important part of a company’s cash flow. A company’s accounts receivable can be used to finance its operations.
