When a Business Factors Its Receivables,it Uses the Receivables as Security

question 145

True/False

When a business factors its receivables,it uses the receivables as security for a loan.

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Definitions:

Operating Activities

Day-to-day actions that relate to producing and delivering a company’s products and services, forming the primary source of revenue.

Future Cash Flows

Future cash flows refer to the estimated monetary inflows and outflows a company expects to receive or pay out in the future, playing a critical role in financial planning and analysis.

Operating Activities

Operating activities refer to the day-to-day functions of a business involved in producing and selling its goods or services, which are reflected in its cash flow.