Relaxation of Credit Policy Results In

question 95

Multiple Choice

Relaxation of credit policy results in:

• A)an increase in credit sales.
• B)a decrease in credit expenses.
• C)a decrease in investment in receivables.
• D)b and c
• E)All of the above

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Definitions:

Equity Method

An accounting technique used to record an investor's earnings proportional to their stake in an associates company.

Cost Method

An accounting technique used to value investments, where the investment is recorded at purchase cost without recognizing subsequent changes in market value.

Consolidated Income Statement

A financial statement that aggregates the financial performance of a company and its subsidiaries.

Sales Revenue

The total amount of money earned from goods and services sold before any expenses are subtracted.