If a Firm Has a Large Percentage of Accounts Over

question 89

True/False

If a firm has a large percentage of accounts over 30 days old, this is proof positive that its receivables manager is not doing a good job.

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Definitions:

Constrained Resource

A limited resource that restricts a company's ability to meet production or operational goals.

Annual Financial Advantage

A term referring to the overall financial benefit that an organization or project is expected to generate on a yearly basis.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue is contributing to covering fixed costs and generating profit.

Machine Hours

A measure of production time, quantifying how many hours machines were operational in a given period.