The Set of Rules That Determines Whether or Not Credit

question 12

Multiple Choice

The set of rules that determines whether or not credit should be extended is known as:

• A) credit analysis.
• B) credit policy.
• C) multiple discriminate analysis.
• D) the terms of trade credit.

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Definitions:

Budgeted Cash Receipts

An estimate of all cash inflows a company expects to receive during a particular period based on expected sales or other income sources.

Accounts Receivable Balance

The total amount of money owed to a company by its customers for goods or services delivered on credit.

Cost Of Goods Sold

The total of all costs used to create a product or service, which has been sold.

Cost Of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including the cost of materials and labor but not distribution or sales costs.