What Is an Accounts Receivable Aging Report?

An accounts receivable aging report lists the money customers owe you on a given date, split by customer and by how long each amount has been outstanding: not yet due, 1 to 30 days past due, 31 to 60, 61 to 90 and over 90 days. It has two jobs. Day to day, it shows who to follow up with. At the end of a period, it's the basis for estimating how much of your receivables won't be collected. This page covers how the report is laid out, how to read it, and how the aging method uses it to estimate uncollectible accounts.

Billed publishes this page. The definitions are quoted from OpenStax, Principles of Accounting, Volume 1, chapter 9 (Rice University), opened on October 30, 2026. Ask your accountant how your business should estimate uncollectible accounts.

What the Report Shows

OpenStax's chapter 9 key terms define accounts receivable as "outstanding customer debt on a credit sale, typically receivable within a short time period". The aging report breaks that balance down:

• One row for each customer, with the total they owe.
• One column for each age group, with the amount in that group.
• A total row for each age group and for the whole report.
• The report date, because every age is counted to that date.

An aging report can count the days past each invoice's due date, or the days since the invoice date. Either works, as long as the report says which and you use the same one every time.

The report total should equal the accounts receivable balance in your books on the same date. If it doesn't, find the difference, such as a payment not yet recorded or an invoice missing from the list, before you rely on the report.

How to Read It

OpenStax's section 9.2 explains why the age matters: "An account that is 90 days overdue is more likely to be unpaid than an account that is 30 days past due."

When you review the report, look for:

• Amounts moving into an older group since the last report.
• One customer with amounts in several groups, which may mean they've stopped paying altogether.
• A large share of the total in one customer, where a single late payment would hurt.
• Credits and partial payments that haven't been applied to the right invoice.

For a weekly follow-up routine based on these groups, see how to track invoices effectively. For the wider collection process and the ratios that measure it, see what is accounts receivable management.

Estimating Uncollectible Accounts: the Aging Method

Under the allowance method, a business estimates at the end of each period how much of its receivables won't be collected. OpenStax's key terms describe the balance sheet aging of receivables method as an "allowance method approach that estimates bad debt expenses based on the balance in accounts receivable, but it also considers the uncollectible time period for each account".

How it works, in OpenStax's section 9.2:

1. Give each age group a percentage. "The length of uncollectible time increases the percentage assigned." The percentages come from your own collection history; ask your accountant how to set them.
2. Multiply and add. Multiply each group's total by its percentage. "All categories of estimated uncollectible amounts are summed to get a total estimated uncollectible balance."
3. Adjust for what's already in the allowance. "If there is a carryover balance, that must be considered before recording Bad Debt Expense." For a credit balance, OpenStax says the company would "subtract the prior period's credit balance from the current period's estimated credit balance in order to calculate the amount to be added to the Allowance for Doubtful Accounts."

For the journal entries and what happens when a specific invoice is written off, see bad debt in business.

Worked Example: Aging a Month-End Balance (sample figures)

The business, customers, percentages and figures here are a sample, invented for this example. The percentages aren't benchmarks.

A sample design agency runs its aging report on June 30, counting days past each invoice's due date:

• Client A: $6,000 not yet due; $2,000 1 to 30 days past due. Total $8,000.
• Client B: $3,500 1 to 30 days; $1,500 31 to 60 days. Total $5,000.
• Client C: $2,500 not yet due; $1,000 61 to 90 days. Total $3,500.
• Client D: $1,500 over 90 days. Total $1,500.

Totals by age group:

• Not yet due: $6,000 + $2,500 = $8,500
• 1 to 30 days: $2,000 + $3,500 = $5,500
• 31 to 60 days: $1,500
• 61 to 90 days: $1,000
• Over 90 days: $1,500
• Report total: $8,500 + $5,500 + $1,500 + $1,000 + $1,500 = $18,000, the same as the four client totals ($8,000 + $5,000 + $3,500 + $1,500) and the accounts receivable balance in the books.

From its own history, the agency uses 1%, 3%, 10%, 25% and 50% for the five groups:

• Not yet due: $8,500 × 1% = $85
• 1 to 30 days: $5,500 × 3% = $165
• 31 to 60 days: $1,500 × 10% = $150
• 61 to 90 days: $1,000 × 25% = $250
• Over 90 days: $1,500 × 50% = $750
• Estimated uncollectible: $85 + $165 + $150 + $250 + $750 = $1,400

The allowance for doubtful accounts already has a $400 credit balance from earlier periods, so the agency records $1,400 − $400 = $1,000 of bad debt expense for June. The allowance then stands at $1,400, and the receivables it expects to collect are $18,000 − $1,400 = $16,600.

Day to day, the same report says where to start: Client D's $1,500 is over 90 days past due, and Client C has $1,000 in the 61 to 90 group alongside an invoice not yet due.

Where Billed Fits

Billed's financial reporting page says: "See your partially paid, past due and paid invoices in a glance with Invoice reports." Its invoice software page says: "Invoice reports show which invoices are paid, partially paid or past due, and you can see who owes you money and send them a payment reminder."

When This Guide Isn't for You

If you sell on credit, report to lenders or investors, or need to decide how to estimate uncollectible accounts for your financial statements, ask your accountant which method and percentages to use. For the same report on the money you owe suppliers, see the accounts payable aging report.

Related Guides

• What Is Accounts Receivable?
• How to Track Invoices Effectively
• What Is Accounts Receivable Management?
• Bad Debt in Business
• Accounts Payable Aging Report
• Cash vs. Accrual Accounting

Frequently Asked Questions

What is an accounts receivable aging report?

A list of what customers owe on a given date, split by customer and by how long each amount has been outstanding, such as not yet due, 1 to 30, 31 to 60, 61 to 90 and over 90 days past due.

How do you read an aging report?

Start with the over-90 and 61-to-90 groups and with customers whose amounts are spreading into older groups. Check that the report total matches the accounts receivable balance in your books on the same date.

How is an aging report used to estimate bad debt?

Each age group gets an uncollectible percentage that rises with age. The group totals are multiplied by their percentages and added up, and the existing allowance balance is taken into account before bad debt expense is recorded. In the sample on this page, a $1,400 estimate with a $400 credit balance already in the allowance means $1,000 of expense.

Should the aging be counted from the invoice date or the due date?

Either can be used. Counting from the due date shows how late each amount is; counting from the invoice date shows how long it's been since you billed. Say on the report which one you use, and use the same one each time.