If the Firm Wants to Identify the Percentage of Accounts

question 121

Multiple Choice

If the firm wants to identify the percentage of accounts receivable that are over 90 days old, the firm should prepare ________________.

• A) A detailed analysis of accounts receivable
• B) An aging schedule
• C) A credit analysis
• D) An analysis of the cash cycle

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Definitions:

Rent Expense

Costs incurred from leasing a property or space for business operations or personal use.

Rental Income

Earnings generated from leasing out property or equipment, recorded as income by the property owner or lessor.

Normal Balance

The aspect of an account, be it on the debit or credit side, designated for recording increments to the account.

Credit

An accounting entry that increases a liability or equity account, or decreases an asset or expense account.