Which of the Following Credit and Collections Decisions Would Typically

question 181

Multiple Choice

Which of the following credit and collections decisions would typically not increase the accounts receivable balance?

• A)Extending credit to less creditworthy customers
• B)Increasing the discount offered for prompt payment
• C)Extending the time allowed for payment of a customer's bill
• D)Delaying dunning letters from the credit department
• E)All of the above would typically increase the accounts receivable balance.

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Definitions:

Standard Hours

The set amount of time expected to complete a job or task, often used for planning and assessing the efficiency of operations.

Volume Variance

The difference between the budgeted volume of production and the actual volume, which affects the fixed overhead costs.

Direct Labor-Hours

A measure of the total hours worked by employees who are directly involved in the production process of a company's products or services.

Fixed Manufacturing Overhead

The portion of manufacturing overhead costs that do not vary with the level of production or sales, such as factory rent.