During the Year, Caltech Inc

question 4

Multiple Choice

During the year, Caltech Inc.'s accounts receivable turnover rate increased from 10 to 12 times. The company makes credit sales only with credit terms of 3/10, n/40. The best explanation for the increase is that

• A) the company's credit department did a better follow up with customers whose account balances became past due.
• B) the company has recently dropped its credit check policy.
• C) the company makes all customers pay cash instead of allowing purchases to be charged.
• D) the company has more customers at the end of the year than it had at the beginning of the year.

---

Definitions:

Applicable

Capable of or suitable for being applied; relevant or appropriate in a given situation.

Leverage

The use of various financial instruments or borrowed money to increase the potential return of an investment.

Linear Model

A mathematical representation of a relationship between two or more variables where the effect is proportional to the cause.

Labeled Points

Points in a dataset that are annotated with additional information, such as a category or label, useful in supervised machine learning.