A General Rule to Use in Assessing the Average Collection

question 127

Multiple Choice

A general rule to use in assessing the average collection period is that it

• A)should not exceed 30 days.
• B)can be any length as long as the customer eventually pays his account.
• C)should not greatly exceed the discount period.
• D)should not greatly exceed the credit period.

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Definitions:

Seller

A seller or company presenting products or services for acquisition to buyers or other enterprises.

Mortgage Loan

A loan used to purchase property or real estate, which is then used as collateral for the loan.

Defective Product

An item that fails to meet acceptable quality or safety standards, potentially causing injury or harm to consumers.

Product Liability Law

Legislation that holds manufacturers, wholesalers, and retailers responsible for any injuries caused by defective products they sell.