Allowing Customers to Buy on Credit Is Only Profitable If

question 34

Multiple Choice

Allowing customers to buy on credit is only profitable if the costs associated with granting credit are less than the profit on the increased sales generated. Which of the following is not one of the additional costs of selling on credit?

• A) Sales commission
• B) Credit checks on customers
• C) Additional record keeping
• D) The cost of collecting outstanding debts

---

Definitions:

Taxes

Compulsory financial dues or another form of tax applied to an individual by a government entity to support government finances and assorted public outlays.

Country

A separate geographical area or political unit acknowledged as a sovereign state.

Taxable Income

The amount of income that is subject to income tax after deductions and exemptions.

Personal Income Tax

a tax levied on the income of individuals or households, typically at a progressive rate.