During 2014, the Accounts Receivable Turnover Rate for Cordner Company

question 111

Multiple Choice

During 2014, the accounts receivable turnover rate for Cordner Company increased from 10 to 14 times per year.Which one of the following statements is the most likely explanation for the change?

• A)The company's credit department has followed up with customers whose account balances are past due in order to generate quicker collections.
• B)The company has decreased sales to its most credit worthy customers.
• C)The company has increased the amount of time customers have to pay their accounts before they are past due.
• D)The company has extended credit to more risky customers in order to increase sales.

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Definitions:

Alliance

A pact, coalition or partnership often formed between entities or organizations to pursue shared goals.

High Status

Reflecting a position of considerable influence, respect, or prestige in a social hierarchy or organization.

Group Norms

Established standards of behavior shared by members of a group, which guide and influence member actions.

Deviate

To depart from an established course or norms.