The Howard Leasing Company is a privately held, medium-sized business that purchases school busses and leases them to school districts, churches charitable organizations and other businesses. To better serve their customers and, more importantly, to protect their investment in the busses, Howard operates a large maintenance facility to maintain and repair leased vehicles and vehicles available for lease. Howard’s annual sales for last year were $37 million with a net income of $2.9 million. Howard employs approximately 150 people.
After graduating with a degree in accounting, you were recently hired as a staff accountant for Howard and are eager to prove your worth to company. Your supervisor just called you into her office and asked you to prepare an accounts receivable aging report as of the end of the year for use in the upcoming audit of the company’s financial statement.
Required
4.1. What is an accounts receivable aging report ?
4.2. Why is an accounts receivable aging report needed for an audit ?
4.3. What is an accounts receivable aging report used for in normal company operations ?
4.4. What data will you need to prepare the report ?
4.5. Where will you collect the data you need to prepare the report ?
4.6. If the data are maintained on paper, how will you collect the necessary data ?
4.7. If the data are in machine-readable from, how will you collect the data ?
4.8. What will the report look like; i.e., how will you organize the data collected to create the information your supervisor needs for the audit ?
4.9. How will you distribute the report ? How many copies will you make ? Who should receive the copies.