What exactly is the accounts receivable balance? Is it an asset and what kind of asset? It’s a current asset, right? What balances are includes in the AR?
Yes, accounts receivable is an asset. In general, the accounts receivable account records the sales that you made on credit. For example, if you sell ten cars (assuming that you sell cars) for $20,000 and you only received $2,000 in cash, then your journals would be:
Debit Accounts Receivable $18,000
Debit Cash $2,000
Credit Sales $20,000