To Reduce the Cost of Collecting Its Accounts Receivable, a Company

question 102

Multiple Choice

To reduce the cost of collecting its accounts receivable, a company sells its accounts receivable to a financial organization.The service is called:

• A)collection agency advance
• B)lock-boxing
• C)factoring
• D)funding

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Definitions:

Critical Value

A point on a statistical distribution that represents a threshold at which the null hypothesis is rejected if exceeded.

Alpha

Alpha, also known as the level of significance, indicates the threshold at which we reject the null hypothesis, typically set at 0.05 or 5%.

Two-tailed

A test of significance that checks for the possibility of either a positive or negative effect and doubles the significance level.

Critical Value

A threshold in hypothesis testing that determines the boundary for rejecting the null hypothesis, based on the chosen significance level.