Aging method - category, and the total of all such...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Aging method . In general, the longer an account balance is overdue, the less likely the debt is to be  paid. Therefore, many companies maintain an  accounts receivable aging schedule , which  categorizes each customer's credit purchases by the length of time they have been outstanding.  Each category's overall balance is multiplied by an estimated percentage of uncollectibility for that 
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: category, and the total of all such calculations serves as the estimate of bad debts. The accounts receivable aging schedule shown below includes five categories for classifying the age of unpaid credit purchases....
View Full Document

Ask a homework question - tutors are online