An Extension Clause Allows the Date of Maturity of an Instrument

question 3

True/False

An extension clause allows the date of maturity of an instrument to be extended into the future.

---

Definitions:

Aging Method

An accounting technique used to estimate uncollectible accounts receivable based on the age of each account's outstanding invoices.

Direct Write-off

The Direct Write-off method is an accounting procedure where uncollectible debts from customers are directly written off against income at the time they are deemed uncollectible.

Bad Debts Recovered

Amounts previously written off as uncollectible but later received or recovered, leading to an adjustment in the financial statements.

Accounts Receivable

Outstanding payments from customers to a business for delivered goods or services awaiting settlement.