When a Business Sells Its Accounts Receivable to a Finance

question 84

Multiple Choice

When a business sells its accounts receivable to a finance company, this is called

• A) selling short.
• B) factoring.
• C) mortgaging the future.
• D) pledging receivables.

Identify key components of an Investment Policy Statement (IPS) for individual investors.

Distinguish between passive and active investment strategies.

Know the benefits of Roth retirement plans.

Recognize good and bad general investment guidelines.

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Definitions:

Downstream Costs

Expenses incurred after the manufacturing process, including distribution, marketing, and customer service.

Production Costs

The total expenses incurred in the process of producing goods or services, including raw materials, labor, and overhead.

Professional Services

Expert services provided by qualified professionals such as lawyers, accountants, and consultants.

Service Shops

Businesses that provide professional or technical services rather than products, often requiring specialized labor or skills.