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Question

Bills receivable account is a/an ___________.

A
Expense Account
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B
Asset Account
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C
Liability Account
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D
Revenue Account
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Solution

The correct option is A Asset Account
Bills receivable is simply an amount receivable from the customer against which a negotiable instrument in the form of bill of exchange is received from a customer. Its a short term asset like other current assets like debtors, stock, etc. Accordingly bills receivables are treated as current assets and shown in the balance sheet.

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