What is full form of AR?
AR FULL FORM- Account Receivable
Account Receivable is a amount that company have to receive from the client or customer because it has given service or goods on credit. After knowing the AR full form , you might get some basic idea about what is Account Receivable, what is included in it.
Example: If ABC Private Limited has sold some goods to XYZ Private Limited on credit of 21days with condition of receiving the same amount will be Account Receivable.
Generally, AR account is related to debtors of company. It is the statement that shows those debtors whom which company has to collect money in future.
What does AR MEAN?
If you are confused about the ar full form or ar meaning. Ar means Ac means Account Receivable. Now we are going to discuss the process of account receivable account that are as follows:
First of all, seller gives quotation to buyer about his product or service. Quotation is the price list of the all the product that are sold be seller. Here the price of goods is negotiated by the both party.
- Purchase order:
Purchase order is a document that is description about the goods like name of goods, quantity of goods, tax applicability and other term and condition of goods. It is document that confirm a order of goods by the buyer.
After receiving the purchase order, the seller creates the invoice for the same quantity and price that are in purchase order. Here, seller gives the detail description of goods like name of goods , quantity of goods, amount of tax applicability etc.
- Goods Deliver:
After creating invoice according to purchase order, the next step is to deliver the same goods to the buyer as per given time. In this process, two documents are issued. One is given to buyer and other is remained by the seller. Here, seller gets receiving from buyer by getting sign of authorized person, then it becomes the proof that goods are delivered to the party.
- Account Receivable ( ar full form ) :
It is last step of the process of account receivable account, here the amount that company have to receive from the buyer is shown in books of account of the company because company have sold goods on credit to the buyer, so company have to receive it in future, and this is the same amount that is called AR.
Other AR full form: