Pledging Accounts Receivable Has All of the Following Characteristics Except

question 119

Multiple Choice

Pledging accounts receivable has all of the following characteristics except:

• A) money is advanced to the borrower as a loan against accounts receivable
• B) accounts receivable balances are removed from the balance sheet
• C) the customer payment is made to the firm, which then submits the payment to the bank
• D) receivables are collected by the firm

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Definitions:

Utility Function

A representation of an individual’s preference ordering over a set of outcomes, quantifying the satisfaction or happiness derived.

Cocoa

A powder made from roasted and ground cacao seeds, used in the making of chocolate, as well as in baking and in beverages.

Consumption

The use of goods and services by households or individuals.

Leather Jackets

Durable and stylish outerwear pieces made from the hides of animals, typically dyed and treated to achieve a smooth finish.