Which of the Following Types of Inventory Financing Is Generally

question 47

Multiple Choice

Which of the following types of inventory financing is generally used for goods that are relatively high priced, slow moving, and easy to identify individually using serial numbers or other distinguishing characteristics?

• A) Warehouse receipt
• B) Trust receipts
• C) Blanket liens
• D) Factoring
• E) Recourse

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Definitions:

Receivables Growth

An increase in the amount of money owed to a company by its customers for products or services that have been delivered or used but not yet paid for.

Fair Value Option

An accounting choice that allows companies to record certain financial assets and liabilities at their fair value, helping to provide a more accurate assessment of a company's financial situation.

Note Receivable

A written promise that one party will pay another party a definite sum of money on demand or at a specified future date.

Long-Term Notes Receivable

Loans or credits extended to borrowers with repayment terms extending beyond one year, recorded as assets on the balance sheet.