NCEA L2 Accounts Receivable Terms

A bill that shows how much money someone owes for a product or service they bought.

• Debtor
• Invoice
• Debt collection firm
• Write-off

A person or a company that buys things from another person or company.

• Bad debt
• Profitability
• Customer
• Cash receipt

The process of sending out invoices to customers for things they bought or services they used.

• Accounts Receivables turnover
• Aged Debtor Report
• Billing
• Credit terms

Checking to see if someone is reliable about paying back money they borrow, like when you want to buy something now and pay for it later.

• Penalties
• Discounts for early payment
• Credit check

A list that shows how much money people owe you and how long they've owed it.

• Write-off
• Customer
• Profitability
• Aged Debtor Report

How quickly a company is able to collect the money it's owed from customers.

• Profitability
• Debt collection firm
• Penalties
• Accounts Receivables turnover

The maximum amount of money you're allowed to spend on credit (buy now, pay later) without getting in trouble.

• Credit limit
• Customer
• Debt collection firm
• Penalties

A piece of paper that shows you've received money from someone.

• Cash receipt
• Write-off
• Bad debt
• Debtor

Money that someone owes you but probably won't ever pay back.

• Penalties
• Bad debt
• Billing
• Customer

Money set aside in case some customers don't pay their bills.

• Cashflow
• Discounts for early payment
• Cash receipt
• Allowance for doubtful debts