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Accounting - Understanding Receivables and Payables

Free Course

Learn more about, and account for, receivables and payables and about account liabilities.

Description Outcome Certification View course modules

In this course you will learn how to account for and manage receivables and payables. For the receivables you will learn how to calculate a bad debt provision amount based on a company’s history using both the aging schedule and the allowance method. The bad debt amount for the financial reports is then managed by posting that provision, and then processing the realized loss of revenue when it becomes overdue.

On the payables side you will learn how to make provision for known liabilities, estimate liabilities such as warranty liabilities and how to plan for the contingent liabilities mostly resulting from legal issues. The course also looks at raising short term finance through the use of promissory notes – distinguishing between interest bearing notes and discounted notes with examples of calculations of the postings for each. You will also learn about accounting for notes that are dishonored.

The final section explains the use of the accounts receivable turnover and the number of days’ sales in accounts receivables ratios and the relevance of the level of liquidity they represent.

This accounting course will be of great interest to entrepreneurs and business professionals who would like to better understand, manage and account for the receivables and payables, and to any learner who is interested in accounting as a future career.

Having studied this course learner will be able to:

  • Account for uncollectable accounts receivable under the allowance method;
  • Record credit card sales and collections; - Define liabilities, current liabilities, and long-term liabilities;
  • Define and account for clearly determinable, estimated, and contingent liabilities;
  • Account for notes receivable and payable, including calculation of interest;
  • Account for borrowing money using an interest-bearing note versus a non interest-bearing note;
  • Analyze and use the financial results - accounts receivable turnover and the number of days' sales in accounts receivable.

All Alison courses are free to enrol, study and complete. To successfully complete this Certificate course and become an Alison Graduate, you need to achieve 80% or higher in each course assessment. Once you have completed this Certificate course, you have the option to acquire official Certification, which is a great way to share your achievement with the world. Your Alison Certification is:

Ideal for sharing with potential employers - include it in your CV, professional social media profiles and job applications
An indication of your commitment to continuously learn, upskill and achieve high results
An incentive for you to continue empowering yourself through lifelong learning

Alison offers 3 types of Certification for completed Certificate courses:

Digital Certificate - a downloadable Certificate in PDF format, immediately available to you when you complete your purchase
Certificate - a physical version of your officially branded and security-marked Certificate, posted to you with FREE shipping
Framed Certificate - a physical version of your officially branded and security-marked Certificate in a stylish frame, posted to you with FREE shipping

All Certification is available to purchase through the Alison Shop. For more information on purchasing Alison Certification, please visit our faqs. If you decide not to purchase your Alison Certification, you can still demonstrate your achievement by sharing your Learner Record or Learner Achievement Verification, both of which are accessible from your Dashboard. For more details on our Certification pricing, please visit our Pricing Page.


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