Accounts receivable appears on which financial statement?

• A. Income statement (statement of operations)
• B. Balance sheet (statement of financial position)
• C. Statement of retained earnings (statement of stockholders’ equity)
• D. Statement of cash flows

Answer: (B)

Verified step by step guidance

1. Understand that accounts receivable represents amounts owed to the company by customers for sales made on credit.
2. Recall that accounts receivable is an asset because it is expected to bring future economic benefits to the company.
3. Identify that assets are reported on the balance sheet (also called the statement of financial position), which shows the company's financial position at a specific point in time.
4. Recognize that the income statement reports revenues and expenses over a period, so accounts receivable does not appear there.
5. Conclude that accounts receivable appears on the balance sheet under current assets, not on the income statement, statement of retained earnings, or statement of cash flows.