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Accounting Information Systems

11th Edition
Ulric J. Gelinas + 3 others
ISBN: 9781337552127

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BuyFindarrow_forward

Accounting Information Systems

11th Edition
Ulric J. Gelinas + 3 others
ISBN: 9781337552127
Textbook Problem

Discuss the information content of Figure 11.7 (pg. 420). How might this report be used by the credit manager or by the accounts receivable manager? If you were either of these managers, what other reports concerning accounts receivable might you find useful, and how would you use them? Be specific.

Summary Introduction

To explain: The uses of these reports and other reports that might be useful.

Introduction:

B/AR/CR process:

It is an accounting process with an interacting structure of different process supporting the decision-making activities of the financial managers.

Explanation

The uses of these reports and other reports that might be useful:

  • The credit manager shall utilize the customer age as a parameter to take decisions regarding permitting credits and adjusting credit limits.
  • The accounts receivable manager might use the aging parameter to follow up on the overdue of receivables.
  • The accounts receivable might match the total due amount with the reported amount on accounts receivable in the financial statements.
  • The due amount with the aging totals can be used to calculate the amount that is to be accrued for the bad debt expense...

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