Rachel believes that the terms accounts receivable and accounts payable can be used interchange- ably. Rachel says,

Question:

Rachel believes that the terms accounts receivable and accounts payable can be used interchange- ably. Rachel says, “They both show up on the balance sheet and they both are in the accounting equation.” Do you agree with Rachel? Explain.

Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...