A System by Which Firms Assign Their Customers for Collection

question 21

Multiple Choice

A system by which firms assign their customers for collection purposes to regional banks that transfer funds to a central bank is known as:

• A) a lock-box system.
• B) a zero-balance account.
• C) a wire transfer.
• D) concentration banking.

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Definitions:

Shares

units of ownership interest in a corporation or financial asset, providing a portion of the profits to shareholders as dividends.

Goodwill Impairment

The process of evaluating and adjusting the carrying value of goodwill on the balance sheet when it exceeds the fair market value, indicating that the acquired asset is not as valuable as originally thought.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that serve as a global framework for financial reporting.

ASPE

Accounting Standards for Private Enterprises, which provide simplified accounting guidelines for private companies in Canada.