Receivables are asset accounts owed to a firm from sales on credit. The objective of receivables management is to promote sales and profits until the return on investment in providing more credit is less than the cost of raising funds to finance that additional credit. Proper receivables management considers factors like sales levels, credit policies, collection costs, default costs, terms of trade, credit standards, and collection procedures.

1. BY - SRK

2.  Receivable are the asset accounts owned to the firm
as a result of sales of goods/services in the ordinary
course of business.

3.  The object of receivable management is to
promote sales and profits until that point is
reached where the return on investment in
future funding of receivable is less than the cost
of funds raised to finance that additional credit
.

4.  Achieving growth in sales.
 Increasing profits.
 Meeting competitions.

5.  Capital Costs.
 Administrative Costs.
 Collection Cost.
 Defaulting Costs.

6.  Level of Sales.
 Credit Policy.
 Terms of trade – Credit Period and Cash
discounts.

7.  Credit Standards.
 Credit Standard – Credit Period and Cash
discounts.
 Collection Procedure.

8.  Management of account Payable is as much
important as management of accounts
receivable. The objective in case of account
payable is to slow down the payments process
as much as possible.