If a Company Is Experiencing Cash Flow Difficulties,it May Opt

question 112

Multiple Choice

If a company is experiencing cash flow difficulties,it may opt to sell its receivables to a third party to generate cash.This is known as

• A)internal cash controls.
• B)pledging.
• C)factoring.
• D)cash management.

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Definitions:

Cost Of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including the cost of materials and labor but not distribution or sales costs.

Budgeted Cost

An estimated cost anticipated for a specified period of time or activity.

Raw Materials Purchases

The total cost or volume of raw materials bought by a company for use in production over a specific period of time.

Budgeted Balance Sheet

A financial statement projected for a future date, detailing the expected financial position in terms of assets, liabilities, and equity.