Extending Credit to Customers Will Introduce All of the Following

question 227

Multiple Choice

Extending credit to customers will introduce all of the following additional costs except:

• A)increased wage costs will be incurred to hire people to evaluate whether each customer is creditworthy,track how much each customer owes,and follow up to collect the receivable from each customer.
• B)bad debt costs will result when amounts cannot be collected from customers.
• C)delayed receipt of cash may result in requiring the company to take out short-term loans and incur interest costs.
• D)decreased gross profit from reduced sales.

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Definitions:

Problem-Focused Coping

A strategy involving tackling a stressful situation directly to alleviate stress or eliminate its cause.

Optimistic

Having a hopeful or positive outlook on the future or the outcome of specific situations.

Social Isolation

Refers to a state where an individual has minimal contact or interaction with others, leading to feelings of loneliness and potentially impacting mental and physical health.

Problem-Focused Coping

A strategy of dealing with stress by tackling the problem that is causing stress directly.