Which statement about aging accounts receivable is true?

• A. The older the account becomes, the harder it is to collect.
• B. The older the account becomes, the easier it is to collect.
• C. Aging has no impact on collection strategy.
• D. Aging reduces the need for follow-up calls.

Answer: (A)

As accounts receivable age, the likelihood of collecting the full amount decreases. Time gives the debtor more opportunities to forget, encounter cash shortages, or lose contact information, and the debt may become less of a priority. Debtors who are long overdue are also more likely to dispute the charge or to have moved on from the paying relationship, making recovery harder. In response, a business typically increases collection efforts and may set aside a larger bad-debt reserve or consider write-offs, which reflects the growing difficulty of collecting older balances.

That’s why the statement that the older an account becomes, the harder it is to collect, is the true one. The other options misstate the relationship between aging and collection: time does not make collections easier; aging does influence collection strategy; and aging generally increases, not reduces, the need for follow-up.