Question

If a company does not prepare an aging of accounts receivable, which of the following accounts is most likely to be misstated?

A. Sales revenues
B. Accounts receivable
C. Sales returns and allowances
D. Allowance for uncollectible accounts

Answer 1

If a company does not prepare an aging of accounts receivable, the most likely account to be misstated is Accounts Receivable.

Step-by-step explanation:

If a company does not prepare an aging of accounts receivable, the account that is most likely to be misstated is Accounts Receivable. An aging of accounts receivable is a report that categorizes the outstanding balances of customers based on how long they are past due. This report helps identify any accounts that are overdue or at risk of becoming uncollectible. By not preparing this report, the company may not have an accurate picture of its Accounts Receivable balance.