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accounts receivable in advance account for the money received in advance by the enterprise from the purchasing unit or the labor service receiving unit in accordance with the provisions of the contract or the agreement of both parties to the transaction.

transactions are risky, especially when dealing with unfamiliar customers for the first time or considering that the customer's credit status is poor and there is a risk of refusal to pay, enterprises often adopt the transaction mode of payment first, and there are usually several ways to pay for goods first: first, pay for goods first in full, that is, how much money is usually collected and how much goods are sent; The second is to receive a certain proportion of money in advance, deliver the goods after receiving the first payment, and then close the payment or collect the money by other agreed methods after the customer receives the goods.

whether to collect money or deliver goods first often depends on the trust of both parties to the transaction and the tightness of the subject matter, that is, it depends on whether the transaction is in the buyer's market or the seller's market. The money received in advance may also have the nature of deposit or guarantee, depending on how the two parties agree in the contract. Selling goods or providing services in advance is the safest transaction method, because it will not generate bad debts, but enterprises may also lose some opportunities for business development.