Accounts receivable aging - Definition

A company's receivables is classified according to the length of time an invoice has been outstanding on the Basis of a periodic report. Account receivable aging is a tool that helps to Analyse and critically understand the company's customer, thereby maintain company's strength.

For example if account receivable aging shows that it takes more than the required time to collect the receivables, it is an indication that the business may be slowing down or that the company is taking big Credit Risk. It there by helps the company to make important decision like, if it should carry on business with the customers who repeatedly pay late.

Terms near "Accounts receivable aging"

Accounts receivable financing

Accounts receivable turnover

Accredited investor

Accredited Personal Financial Planning Specialist

Accreted value

Accretion

Accretive

Accrual basis accounting

Accrual bond

Accrual of discount