A Factor Buys Receivables from Businesses for a Fee and Collects

question 129

True/False

A factor buys receivables from businesses for a fee and collects the payment directly from customers.

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Definitions:

Manufacturing Firms

Companies that produce finished goods from raw materials through the use of labor, machinery, and equipment.

Merchandising Firms

Companies that purchase inventory in a finished form for the purpose of reselling it to consumers without further processing.

Manufacturing Firms

Companies engaged in the transformation of raw materials into finished products through the use of labor, tools, machinery, and chemical processing.

Merchandising Firms

Businesses that purchase finished goods for resale, typically operating in the retail or wholesale sectors.