What term describes the money owed to a company by its debtors?

The term that describes the money owed to a company by its debtors is "Accounts Receivable." This refers to amounts that a company has the right to collect because it has provided goods or services on credit to customers. When a business makes a sale on credit, it records the transaction as an accounts receivable, reflecting the expectation of future cash inflows.

Understanding this term is crucial for managing a company's finances. It helps in assessing liquidity and the efficiency of credit control processes. The effective collection of accounts receivable can directly impact a company's cash flow and financial health. Thus, recognizing accounts receivable as an asset is important, as it represents potential income that has not yet been received.

In contrast, accounts payable refers to the money a business owes to its suppliers, inventory is related to the goods a company holds for sale, and cash equivalents are short-term, highly liquid investments that can be quickly converted into cash. These other terms represent different aspects of a company's financial dealings, but they do not pertain to the money owed to it by debtors.