Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

7. Receivables and Investments

Types of Receivables

Financial Accounting

7. Receivables and Investments

Types of Receivables

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Multiple Choice

An aging schedule classifies accounts receivable based on:

the size of the receivable balance

the creditworthiness of customers

the length of time outstanding

the geographic location of customers

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Verified step by step guidance

Understand the concept of an aging schedule: An aging schedule is a tool used in financial accounting to categorize accounts receivable based on the length of time they have been outstanding. It helps businesses assess the likelihood of collecting receivables and identify overdue accounts.

Identify the purpose of the aging schedule: The primary goal is to evaluate the collectability of receivables and determine if any accounts may require adjustments, such as allowances for doubtful accounts.

Focus on the classification criteria: The aging schedule classifies accounts receivable based on the length of time they have been outstanding, not factors like the size of the balance, creditworthiness, or geographic location.

Recognize the typical format of an aging schedule: Accounts receivable are grouped into categories such as 'Current,' '30-60 days overdue,' '60-90 days overdue,' and 'Over 90 days overdue.' This helps in analyzing the aging of receivables.

Apply the aging schedule in practice: Use the schedule to assess the risk of non-payment, adjust the allowance for doubtful accounts, and make informed decisions about credit policies or collection efforts.