Given the Following Computer Printout from a Factor Analysis, Which

question 24

Multiple Choice

Given the following computer printout from a factor analysis, which of the following statements is TRUE? ​

• A)There are seven factors.
• B)There are seven variables.
• C)Factor #7 could be eliminated from the analysis.
• D)Variable #2 is most important for factor #2.
• E)Variable #3 tells us nothing.

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Definitions:

Uncollectible

Refers to accounts receivable that a company has deemed to be uncollectable and is likely to write off as a bad debt.

Direct Write-off Method

A method of accounting for bad debts in which companies write off receivables when they determine they are uncollectible.

Days' Sales in Receivables

A financial metric that measures the average number of days it takes for a company to collect payments from its credit sales.

Aging the Receivables

The process of categorizing accounts receivable according to the length of time an invoice has been outstanding.