A firm has determined that 66 per cent of its accounts receivable are less than 1 month old,32 per cent are more than 1 month but less than 2 months old,and the remainder are more than 2 months old.The firm probably compiled a(n)_____ to determine this information.
A)credit scoring report
B)aging schedule
C)settlement statement
D)collateral trust schedule
E)invoice

Question

Quizplus · Accepted Answer

An aging schedule is a report that categorizes a company's accounts receivable according to the length of time an invoice has been outstanding. This report helps the firm to determine the status of its accounts receivable and the potential for cash flow problems. In this case, the firm used an aging schedule to determine that 66% of its accounts receivable are less than 1 month old, 32% are more than 1 month but less than 2 months old, and the remainder are more than 2 months old.

A Firm Has Determined That 66 Per Cent of Its