In a Factoring of Accounts Receivable with Recourse,which Party Bears

question 61

Multiple Choice

In a factoring of accounts receivable with recourse,which party bears (indicated by * in the answer alternatives) the cost of bad debts and sales adjustments? $$\begin{array} { | c | c | c | } \hline & \text { Bad debts } & \text { Sales adjustments } \\\hline 1 \text { Transferor } & * & * \\\hline 2 \text { Factor } & & * \\\hline \text { Transferor } & & * \\\hline \text { 3 Factor } & * & \\\hline \text { Transferor } & * & \\\hline \text { 4 Factor } & * & \\\hline\end{array}$$

• A)Choice 1
• B)Choice 2
• C)Choice 3
• D)Choice 4

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