 Hello, in this lecture we will define credit terms. According to fundamental accounts and principles while 22nd edition, the definition of credit terms is description of the amounts and timing of payments that a buyer debtor agrees to make in the future. So we're talking about the terms of when payment will be received. So if we have a transaction that takes place, if it was made on account, meaning whether some kind of IOU, the payment has not yet been received, then we need the terms as to when the payment should be received. So for example, if we had a transaction like this where we're selling inventory, we're getting the IOU, it goes on the books with a debit to account receivable and an increase in the sales, a credit to sales. Question is that account receivable, when do we expect payment on that account receivable? We could have the terms may be on the invoice and terms could be formatted something like this, it could say 2 slash 10 and slash 30. That would be more complicated terms in that we're saying there's a 2% discount if we're paid within 10 days. Otherwise, we need to pay within 30 days. The terms could be as simple as just we expect payment within 30 days. That's when we expect to be paid for the transaction that took place today on account or it could be some more complex type of terms. But what we're looking for is when will payment be received for the transaction that was made on account, meaning when are we going to receive the cash related to this accounts receivable.