Factoring Accounts Receivable Has All of the Following Characteristics Except

question 16

Multiple Choice

Factoring accounts receivable has all of the following characteristics except:

• A)the borrower sells the receivable
• B)accounts receivable balances are removed from the balance sheet
• C)the customer payment is made to the factor
• D)all of the above are characteristics of pledging

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Definitions:

Diluted Earnings Per Share

A performance metric that shows the quality of earnings per share if all convertible securities were converted into shares.

Potential Common Shares

Financial instruments or arrangements that could potentially be converted into common stock, impacting the earnings per share calculation.

Earnings Per Share Footnotes

Additional notes in financial reports that provide details on the calculation and factors affecting the earnings per share metric.

Accumulated Other Comprehensive Income

A component of shareholders' equity, representing income that is not part of net income, such as unrealized gains or losses on certain types of investments.