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Route Canal Shipping Company has the following schedule for aging of accounts receivable:

e. What additional information does the aging schedule bring to the company that the average collection period may not show?

Short Answer

Expert verified

The aging schedule helps in evaluating the credit policy and forecasting cash inflows.

Step by step solution

01

Meaning of aging schedule

The aging schedule depicts the organization’s accounts receivables and the due date of these receivables. This schedule helps an organization in evaluating it its customers are paying their debt on time.

02

Explanation of requirement

The aging schedule helps the organization evaluate the efficiency of its credit policy. This schedule also helps an organization in forecasting its cash inflows.

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Most popular questions from this chapter

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January

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However, Antonio decides to go with level production to avoid being out of merchandise. He will produce the 11,500 items over four months at a level of 2,875 per month.

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