Note Receivable - Long Term
What is Note Receivable - Long Term?
Note Receivable - Long Term represents the portion of receivables from customers, which will not be collected within one year or within the operating cycle. Long term receivables are usually secured through notes or other similar guarantees as longer periods of collection imply greater risk for a company.
These receivables usually arise from a customer’s purchase of goods and services on credit, but includes other forms of credits, such as long term loans. These are usually interest-earning.
What does Note Receivable - Long Term include?
- Finance receivables for companies with finance subsidiaries;
- Investment in sale-type leases;
- Loans to other companies;
- Long term loans to employees;
- Notes receivable from shareholders;
- Receivables from Affiliated Companies, when these are not related or affecting control; and
- Stock Subscription Receivables.