Which one of the following statements is correct?

Question

Quizplus · Accepted Answer

An aging schedule is a tool used to identify which customers are the most delinquent by categorizing receivables by the length of time they have been outstanding.

Answer: D 
 A constant average collection period indicates that the firm is not managing its receivables effectively, as it means that the time it takes for customers to pay is not improving or getting worse over time.

The other statements are incorrect:
B) The percentage of total receivables that fall within a certain time period on an aging schedule will not remain constant over time, as the amount of outstanding receivables and the aging of those receivables will change over time.
C) Firms may choose to call their delinquent customers prior to sending a past due letter, but this is not always the case.
E) It is not common practice to sell a bankrupt customer's receivable at face value, as there is a high risk that the customer will not be able to pay the debt.

Which One of the Following Statements Is Correct