A firm's age of accounts receivable:
A)measures the average time between credit-based sales and the collection of payments for those sales.
B)is likely to be greater for firms within the same industry with more generous credit terms.
C)is in part a function of the type of industry in which the firm operates.
D)All of the above.

Question

Quizplus · Accepted Answer

The age of accounts receivable measures the average time between credit-based sales and the collection of payments for those sales. It is likely to be greater for firms within the same industry with more generous credit terms. Additionally, it is in part a function of the type of industry in which the firm operates. Therefore, all three choices are correct.

A Firm's Age of Accounts Receivable