Notes receivable account will be credited when a promissory note is used to replace an accounts receivable balance.
The term "accounts receivable," often known as "AR" or "A/R," refers to a company's legally enforceable claims for payment for items delivered or services provided that consumers have requested but haven't paid for.
The proceeds or money that the business will receive from its clients who have financed their purchases of its goods and services are known as accounts receivable (AR). The credit term is often brief, ranging from a few days to several months or even a full year in rare situations.
The amount of money that clients owe a company for goods or services already rendered is measured by accounts receivable. Investors can get a better understanding of a company's overall financial stability and liquidity by looking at its accounts receivable.
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