Allowing Customers to Buy on Credit Is Only Profitable If

question 52

Multiple Choice

Allowing customers to buy on credit is only profitable if the costs associated with granting credit are less than the profit on the increased sales generated. Which of the following is not one of the additional costs of selling on credit?

• A) Credit checks on customers
• B) Additional record keeping
• C) Sales commission
• D) The cost of collecting outstanding debts

---

Definitions:

Diamond Ring

A piece of jewelry featuring a precious gemstone that is typically set in gold, silver, or platinum and worn on the finger.

DVD Player

An electronic device that plays discs produced under the DVD video standard.

Noodle Soup

A dish consisting of noodles served in a broth, potentially accompanied by various ingredients like meats, vegetables, or seasonings.

The Cross

A symbol consisting of two intersecting lines or bars, often used in Christianity to represent the crucifixion of Jesus.