Which of the Following Actions Will Tend to Decrease the Accounts

question 50

Multiple Choice

Which of the following actions will tend to decrease the accounts receivable period?
I.Loosening the standards for granting credit to customers
II.Increasing the discount for early payment by credit customers
III.Increasing the finance charges applied to all customer balances outstanding over thirty days
IV.Granting discounts for cash sales

• A)I and III only
• B)II and IV only
• C)I,II,and IV only
• D)II,III,and IV only
• E)I,II,III,and IV

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Definitions:

Barriers To Entry

Factors that make it difficult for new competitors to enter a market.

Net Social Cost

The total monetary cost of the negative externalities produced by an activity or production, minus any benefits.

Rent-Seeking Behavior

Activities aimed at increasing one's share of existing wealth without creating new wealth, often through manipulation or exploitation of the economic environment.

Profits

The financial gain realized when the revenue from selling goods or services exceeds the costs of production.