Businesses Are Often Required to Extend Credit as a Means

question 5

Multiple Choice

Businesses are often required to extend credit as a means of increasing sales.Before granting credit,businesses are encouraged to take any of the following steps EXCEPT

• A)take advantage of the available public records of credit history,proposals,and bankruptcies.
• B)search both the corporate name of the debtor and its directors and officers to determine if the company is merely a fresh start after a bankrupt business.
• C)not request personal guarantees of the principals because the company's agreement to pay will always suffice.
• D)take security in the goods provided.
• E)set up a control system to monitor lien periods for building supplies and limitation periods.

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Definitions:

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