What is a restriction regarding accounts with DNR status?

The correct understanding of the restriction regarding accounts with DNR (Do Not Renew) status is that they should not exceed a receivable age of less than $50. Accounts designated with DNR status typically indicate that they are not eligible for further transactions or financing due to specific conditions or risks associated with them. Therefore, if a receivable is too old, it is generally not advisable to renew or extend credit on it, as it can reflect issues such as uncollectibility or other financial distress.

Managing receivables effectively is crucial to mitigate risk, and an aging analysis is a common practice to evaluate the creditworthiness of accounts. By ensuring that accounts do not exceed a certain age threshold, organizations can maintain better control over their financial exposure and avoid additional risks associated with potentially unrecoverable debts.