When Managing Accounts Receivable, a Good Strategy to Employ Without

question 64

Multiple Choice

When managing accounts receivable, a good strategy to employ without losing future sales is to

• A) send the accounts to a collection agency.
• B) tighten the credit terms.
• C) offer cash discount.
• D) make frequent personal visits to the customer.

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Definitions:

Dissolution

Dissolution is the process of formally ending the existence of a legal entity such as a company or partnership.

Winding Up

The process of dissolving a company by selling its assets, paying off creditors, and distributing the remaining assets to shareholders.

Liquidation

The process of closing a business and distributing its assets to claimants.

Capital Contribution

The cash, property, or other assets that investors or owners provide to a business in exchange for an ownership interest or equity.