BUSINESS ADMINISTRATION
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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study the effectiveness of accounts receivable collection
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determine which accounts payable to pay first
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decide when equipment needs to be replaced
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increase the credit limit for customers who have difficulty paying their accounts
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Detailed explanation-1: -An accounts receivable aging report is a consolidation of records that shows the due amount of all your customers from the day the invoice was issued. This report helps businesses identify the invoices which are still outstanding and track their collection efforts.
Detailed explanation-2: -Accounts receivable aging is used to estimate the value of receivables that the company does not expect to collect. This information is used to adjust the company’s financial statements to avoid overstating its income.
Detailed explanation-3: -Often created by accounting software, an aging schedule can help a company see if its customers are paying on time. It’s a breakdown of receivables by the age of the outstanding invoice, along with the customer name and amount due.