When Platinum Fitness Sells Its Accounts Receivable to a Financial

question 125

Multiple Choice

When Platinum Fitness sells its accounts receivable to a financial institution, it receives less than the full value of the accounts receivable. Which of the following is a benefit Platinum Fitness receives from this arrangement?

• A) It will receive the money in one month instead of two months.
• B) It will have more inventory than its competitors.
• C) This will allow closer relationships with its customers.
• D) The time and expense of collecting accounts shifts to the factor.
• E) Platinum will be responsible for collecting the accounts.

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Definitions:

Beneficence

The ethical principle that emphasizes acting in the best interests of others, promoting good actions and minimizing harm.

Equal Distribution

The equitable allocation of resources, benefits, or responsibilities among all members of a society or group.

Interest in Existing

The inherent value or concern accorded to the state of being alive or existence itself.

Medical Research

The scientific study aimed at understanding human health and disease, developing treatments, and improving medical care.