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How can we differentiate between :
1) account receiveable and prepayments
2) account payable and accruals
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Pls correct me If I am wrong here:
1) Account Receivable and Prepayments are both current assets, receivables are where we have sent an invoice but have yet not yet received it. Prepayments are where we have not yet sent an invoice but know that we do own money.
2) Account Payable and Accruals are both current liabilities, payables are where we have received an invoice but have not yet paid it. Accruals are where we have not uet received an invoice but know that we do owe money.
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