Which of the following is NOT a type of receivable commonly reported on a company's balance sheet?

• A. Inventory Receivable
• B. Accounts Receivable
• C. Notes Receivable
• D. Interest Receivable

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the concept of receivables. Receivables are amounts owed to a company by customers or other parties, typically arising from credit sales or lending activities. They are classified as assets on the balance sheet.
2. Step 2: Review the common types of receivables reported on a company's balance sheet. These include Accounts Receivable (amounts owed by customers for goods or services), Notes Receivable (formal written promises to pay), and Interest Receivable (interest income earned but not yet received).
3. Step 3: Analyze the term 'Inventory Receivable.' Inventory refers to goods available for sale, not amounts owed to the company. It is classified as an asset but not under receivables. Therefore, 'Inventory Receivable' is not a valid type of receivable.
4. Step 4: Compare the options provided in the question. Identify which term does not fit the definition of receivables based on the explanation above.
5. Step 5: Conclude that 'Inventory Receivable' is NOT a type of receivable commonly reported on a company's balance sheet, as it does not represent amounts owed to the company.