Which One of the Following Statements Is Correct

question 75

Multiple Choice

Which one of the following statements is correct?

• A)An aging schedule helps identify those customers who are the most delinquent.
• B)The percentage of total receivables that falls within a certain time period on an aging schedule will remain constant over time even if the firm has seasonal sales.
• C)Normally firms call their delinquent customers prior to sending them a past due letter.
• D)A constant average collection period over a period of time is cause for concern.
• E)It is common practice when a customer files for bankruptcy to sell that customer's receivable at face value.

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Definitions:

JIT

Just-In-Time; a supply chain management strategy aimed at reducing inventory costs by receiving goods only as they are needed in the production process.

MRP

Material Requirements Planning is a system for calculating the materials and components needed to manufacture a product, ensuring that materials are available for production and products are available for delivery.

EOQ Model

The Economic Order Quantity model, a formula used in inventory management to determine the optimal order size that minimizes total holding and ordering costs.

Inventory Management

The supervision of non-capitalized assets (inventory) and stock items to ensure an adequate supply without excessive oversupply.