Which of the Following Is Not Correct

question 31

Multiple Choice

Which of the following is not correct?

• A) A more aggressive collection policy will reduce bad debt expenses, but may also decrease sales.
• B) Collection policy usually has little impact on sales since collecting past-due accounts occurs only after the customer has already purchased.
• C) Typically a firm will turn over an account to a collection agency only after it has tried several times on its own to collect the account.
• D) A lax collection policy will frequently lead to an increase in accounts receivable.
• E) Collection policy is how a firm goes about collecting past-due accounts.