Deposits in Transit

question 31

Multiple Choice

Deposits in transit

• A) have been recorded on the company's books but not yet by the bank.
• B) have been recorded by the bank but not yet by the company.
• C) have not been recorded by the bank or the company.
• D) are checks from customers which have not yet been received by the company.

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Definitions:

Credit Period

The duration of time a buyer is allowed to pay for goods or services received, before interest or penalties begin accruing.

Collection Policy

The specific strategies and methods a company uses to manage the collection of its accounts receivable.

Credit Policy

The guidelines a company follows to determine the amount of credit to extend to customers and the terms of payment.

Credit Period

The time frame allowed by a seller for a buyer to pay for goods or services received, typically measured in days or months.