The financial statements of beige inc. shows a beginning balance of accounts receivable of $5,000 and a closing balance of accounts receivable of $8,000. which of the following can be inferred from this observation?

an increase of $3,000 in accounts receivable

Explanation:

An account receivable is an asset. It is when a company is expecting to receive money for goods it has provided or services it has rendered.

The accounting convention of realization and matching allow for the business entity to record this receivable in its books in the particular year it has occurred whether it has received the money or not as long as risk and reward has been exchanged and there is a reliable measurement for the amount to be received or exchanged.

In the question above, the company started the year with $5000 it is expecting to receive from customers and at the end of the year, it had $8,000 it was expecting to receive from customers. This means that in the course of the year, this particular entity has sold more goods on credit, thus having more receivables from its customers.

It is also possible that the company needs to work on its receivables policy.

I hope this explanations helps you understand everything around receivables accounting.

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answer; hazards;