The Process of Classifying Accounts of Individual Customers by Age

question 115

Multiple Choice

The process of classifying accounts of individual customers by age group, where age is the number of days elapsed from due date is specifically called:

• A) balance sheet approach.
• B) income statement approach.
• C) direct writeoff method.
• D) aging of Accounts Receivable approach.

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Definitions:

Journal Entry

An entry made in a journal that records a specific financial transaction, including amounts, accounts affected, and a description.

Control Procedures

These are policies and practices that organizations put in place to ensure the integrity of their financial and accounting information and to prevent fraud.

Reasonable Assurance

A level of confidence in the accuracy or reliability of a process, often used in context with financial controls and auditing.

Vulnerabilities

Weaknesses in a system that can be exploited by threats to gain unauthorized access or cause harm.