What is Aging analysis and accrual entries?

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Aging analysis is a process of categorizing accounts receivable/payable by their due dates. Accrual entries are adjusting entries made to record revenue/expenses in the correct accounting period.

Aging analysis helps in identifying overdue payments and managing cash flow.
Accrual entries are made to ensure that revenue and expenses are recorded in the correct accounting period, even if the payment is received or made in a different period.
For example, if a company provides services in December but receives payment in January, an accrual entry is made to record the revenue in December.
Similarly, if a company receives an invoice in December but pays it in January, an accrual entry is made to record the expense in December.

What is Aging analysis and accrual entries?

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