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<< Click to Display Table of Contents >> Navigation: MLS 2026 Fully Integrated Accounting > Accounts Receivable > Accounts Receiveable Overview |
Accounts Receivable (A/R) is the process of extending credit to clients, tracking outstanding balances, and recording payments. MLS 2026 is designed to make this process straightforward, accurate, and easy to manage—helping reduce bad debt while maintaining strong client relationships.
Most clients pay at the time of service using cash, check, or credit card. These are considered cash payments because they convert immediately into bankable funds.
When a client is allowed to pay later, the unpaid amount becomes a receivable. In effect, you are providing goods or services now in exchange for a promise of future payment.
Each client’s activity is maintained in an individual A/R account ledger. This allows you to view:
•Current outstanding balance
•Complete history of charges and payments
•Status of unpaid invoices
•Account notes and activity
This account-based structure is the foundation of all A/R management in MLS 2026.
All A/R activity automatically updates the General Ledger to ensure accurate financial reporting.
When an invoice is posted to A/R:
•Debit → Accounts Receivable (Asset)
•Credit → Appropriate income account
When a payment is received:
•Credit → Accounts Receivable
•Debit → Cash (or selected payment account)
This ensures that both customer balances and financial statements remain synchronized.
Throughout the billing period, MLS 2026 records all charges and payments. At the end of the cycle, you should generate statements for each client.
Even when individual invoices are issued, a monthly statement provides:
•A consolidated view of activity
•A clear current balance
•A reminder for outstanding amounts
MLS 2026 supports two standard statement types:
•Displays prior balance
•Lists current charges and payments
•Calculates a new ending balance
Best for:
Revolving credit environments (similar to credit cards or retail accounts)
•Lists each unpaid invoice individually
•Removes invoices as they are paid
Best for:
Service-based businesses that require precise tracking of individual invoices
Receivables are aged to show how long invoices have been outstanding. Standard aging periods include:
•0–29 days (current)
•30–59 days
•60–89 days
•90+ days
Older balances may indicate overdue accounts depending on assigned payment terms.
Most clients operate under Cash on Delivery (COD) terms. Others may be assigned credit terms such as:
•Net 10 — Payment due within 10 days
•Net 30 — Common for business or fleet accounts
When a client exceeds their payment terms, the account becomes delinquent.
•Occasional delays are usually resolved with a reminder
•Repeated delays may require stricter controls or collection procedures