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Preparing an Aging Schedule for Accounts Receivable

Laura's Ad Agency accounts receivable totaled $451,000 on February 28, 2011. An aging summary of receivables at this date follows:

End of Month Amount
February 2011 $250,000
January 2011 100,000
December 2010 50,000
November 2010 30,000
October 2010 and before 21,000

The firm extends 30-day credit terms to all of its customers.

a) prepare an aging schedule for Laura's agency
b) evaluate the collection performance
c) what percentage is overdue

Solution Summary

Laura's Ad Agency accounts receivable totaled $451,000 on February 28, 2011. An aging summary of receivables at this date follows:

End of Month Amount
February 2011 $250,000
January 2011 100,000
December 2010 50,000
November 2010 30,000
October 2010 and before 21,000

The firm extends 30-day credit terms to all of its customers.

a) prepare an aging schedule for Laura's agency
b) evaluate the collection performance
c) what percentage is overdue

$2.19