Age analysis is a method used to classify receivables or payables based on the length of time they have been outstanding.

Simple Meaning:

It shows how long money has been due.

Common Format:

Receivables are grouped into categories such as:

0–30 days

31–60 days

61–90 days

Above 90 days

Purpose:

Identify overdue accounts

Estimate bad debts

Improve credit control

Example:

If a customer’s invoice is unpaid for 75 days, it will fall under the 61–90 days category.

In short, age analysis helps businesses track and manage outstanding amounts effectively