A Deferral Exists When a Company Receives Cash

question 17

Multiple Choice

A deferral exists when a company receives cash

• A)after recognizing the associated revenue.
• B)at the same time the associated revenue is recognized.
• C)before recognizing the associated revenue.
• D)either before or after recognizing the associated revenue.

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Definitions:

Pledge of Inventory

The use of a company's inventory as collateral to secure a loan or meet other financial obligations.

Factoring

A financial transaction where a business sells its accounts receivable to a third party at a discount to raise immediate capital.

Turning Receivables

Involves managing and collecting funds owed to a business by its customers within a given period.

Credit Profile

A summary or analysis of an individual's or entity's credit history and current financial status used by lenders to gauge creditworthiness.