CarePair, a Small Business Specializing in Making and Distributing Hospital

Multiple Choice

CarePair, a small business specializing in making and distributing hospital gowns to medical facilities, often sells its product on credit. The company maintains a ledger that divides accounts receivable into age categories based on the length of time they have been outstanding. Receivables 1-6 months old are deemed grade A (regular business) ; 7-12, grade B (overdue business) ; and 13-24, grade C (delinquent business) ; those accounts receivable over 24 months old are turned over to a collection agency. CarePair is relying on ____ to keep track of accounts receivable.

A) a collection categorization
B) an aging schedule
C) a delinquent adjustment schedule
D) a financial credit schedule