Postdated checks are considered as__________?
Correct answer: C. Accounts receivable
- A. Cash
- B. Bank balance
- C. Accounts receivable
- D. Cash reserve
Explanation
A postdated cheque cannot be encashed until its stated future date, so it is not treated as cash immediately. It is generally treated as a receivable until the date arrives.
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About Accounting Principles
Accounting principles explain the rules used to record, classify and report business transactions. Coverage includes the accounting equation, double-entry system, accrual and cash bases, matching and prudence concepts, consistency, going concern, business entity, and the difference between capital and revenue items.
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