A Firm's Collection Policy, I

question 127

True/False

A firm's collection policy, i.e., the procedures it follows to collect accounts receivable, plays an important role in keeping its average collection period short, although too strict a collection policy can reduce profits due to lost sales.

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Definitions:

Supportive

Providing assistance, encouragement, or emotional help to others in a way that promotes a positive environment or outcome.

Corrective

Designed to correct or rectify an error, fault, or undesirable outcome, often through specific interventions or adjustments.

Feedback

Information provided about reactions to a product, a person's performance of a task, etc., used as a basis for improvement.

Feedback Timely

Relates to the promptness with which feedback is delivered, ensuring that it is given in a time frame that is relevant and useful for the recipient.