If a Company Decides to Factor Its Receivables Without Recourse

question 129

Multiple Choice

If a company decides to factor its receivables without recourse, it will:

• A)offer the receivables to a lending institution as collateral.
• B)sell receivables to a lender and remain liable for uncollectible accounts.
• C)sell the receivables at a discount.
• D)offer receivables that are more than 120 days old to a collection agency.
• E)none of the above defines factoring receivables.

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Definitions:

Agricultural Products

Items derived from farming activities, including both food products like fruits, vegetables, and grains, as well as non-food items like cotton and wool.

Farm Productivity

The measure of output (crop or livestock) produced per unit of input (such as land, labor, or capital) on a farm.

U.S. Farm Products

Agricultural goods produced in the United States, which include a wide range of food and raw materials.

Foreign Tariffs

Taxes imposed by a government on goods and services imported from other countries, often used to protect domestic industries.