The aging of accounts receivable method is based upon the principle that the longer an account is overdue,the higher the risk of non-payment.
BT: Knowledge

Question

Quizplus · Accepted Answer

The statement is correct and reflects the correct principle of the aging of accounts receivable method. As the account gets older, the likelihood of non-payment increases, resulting in a higher risk factor. Therefore, B is an incorrect statement.

The Aging of Accounts Receivable Method Is Based Upon the Principle