Why Is Accounts Receivable Financing NOT a Costless Transaction for a Firm

question 35

Multiple Choice

Why is accounts receivable financing NOT a costless transaction for a firm?

• A)The receivables must be sold at a discount.
• B)The receivables are used as collateral, making them less valuable.
• C)The receivables must now be shown as a liability on the firm's books.
• D)Customers do not like it and sometimes take their business elsewhere.

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Definitions:

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Suprachiasmatic Clock

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