Which One of the Following Statements Is True If a Company's

question 64

Multiple Choice

Which one of the following statements is true if a company's collection period for accounts receivable is unacceptably long?

• A)The company may need to borrow to acquire operating cash.
• B)The company may offer trade discounts to lengthen the collection period.
• C)Cash flows from operations may be higher than expected for the company's sales.
• D)The company should expand operations with its excess cash.

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Definitions:

Market

A place or system where parties engage in exchange, buying and selling goods and services.

S And D

Shorthand for Supply and Demand, the interaction between the quantity of goods offered by the market and the desires of consumers.

Overproduction

A situation where more goods are produced than can be sold, leading to surplus inventory and often resulting in waste or economic imbalances.

Market Price

The existing rate at which a service or asset is offered for buying or selling in a certain market.