Collection Float
Collection Float is the time spent to collect receivables. Collection float is the sum total of time taken by Invoice Float; Mail Float; Processing Float and Availability Float. Explore more!
Invoice to Cash– Collection Float
Collection Float is the time spent to collect receivables.
Collection float is the sum total of time taken by Invoice Float; Mail Float; Processing Float and Availability Float
1. Invoicing float is the time period between the delivery of goods or services to the customer and the customer's receipt of the bill, generally by mail. It is the time it takes a company to record its delivery of service or
goods and then to produce and mail a bill.
2. Mail float is the time taken by Postal or Courier Service to deliver the customer's payment.
3. Processing float is the period between the receipt of the payment and its deposit into the company's bank account and includes the time it takes to record the payment in the accounting system.
4. Availability float is the time it takes the deposited check to clear the customer's account and for good funds to be available to the company for disbursement.
Related Links
You May Also Like
-
In the previous article we talked about the meaning of the account reconciliations. Now as you now the definition of account reconciliation, in this article let us see why it is carried out.
-
What is Account Reconciliation?
Before you understand the Bank Reconciliation Process it is important to understand what is account reconciliation and why it is carried out.
-
Technology has enabled the treasury function by providing various solutions to manage it's complicated tasks. This article explains various types of treasury management systems available in the market.
-
Bank Reconciliation is a PROCESS to Validate the bank balance in the general ledger With Bank Statement. Learn the bank recon process.
-
Collection Float is the time spent to collect receivables. Collection float is the sum total of time taken by Invoice Float; Mail Float; Processing Float and Availability Float. Explore more!
-
The terms Treasury Management and Cash Management are sometimes used interchangeably, while, in fact, the scope of treasury management is larger and includes funding and investment activities as well. Learn all about Treasury Management here!
-
Cash Clearing – Accounting Entries
The Cash Clearing process enables you to track amounts that have actually cleared your bank. Learn the steps and accounting entries that gets generated during the cash clearing process.
-
What are the various sources of cash in an organization. Which sources increase the cash available with the enterprise and which sources results in outflow of the cash? Let us explore!
-
Many different accounts are used in finance. Understand the representation and nature of clearing account in context of accounting, finance and ERP Systems.
