A Firm Is Said to Be Extending Net Trade Credit

question 139

True/False

A firm is said to be extending net trade credit when its accounts receivable are less than its accounts payable.

---

Definitions:

Inventory Control

The management of inventory to ensure the right quantity of supplies for operation without excess, thus minimizing costs.

International Financial Reporting Standards

Global accounting principles that provide guidance for companies on how to report financial events and conditions.

Prohibited

Refers to actions or activities that are forbidden by law, regulation, or policy.

LIFO

"Last In, First Out," an inventory valuation method where the most recently produced or acquired items are the first to be expensed.