Which of the Following Changes Would Result in Higher Receivables

question 218

Multiple Choice

Which of the following changes would result in higher receivables?

• A)Tightening credit policy
• B)An increase in the net period of the terms of sale
• C)An increase in the prompt payment discount offered
• D)All of the above

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Definitions:

Financial Ratios

Metrics derived from financial statement analysis used by investors and analysts to evaluate a company's financial health and performance.

Bankruptcy

A legal proceeding involving a person or business that is unable to repay outstanding debts, leading to the liquidation or reorganization of assets under the law.

Operating Cash Flows

This represents the cash generated from a company's normal business operations, highlighting the company's ability to generate sufficient revenue to maintain and grow its operations.

Receivables

Money owed to a company by its customers or other parties for goods and services provided on credit.