Which of the Following Statements About Collection Time Is NOT

question 74

Multiple Choice

Which of the following statements about collection time is NOT true?

• A) Collection time, or float, is the time between when a customer makes a payment and when the cash becomes available to the firm.
• B) Collection time can be broken down into three components.
• C) Delivery time or mailing time is not part of the collection time.
• D) Processing delay is one of the components of the collection time.

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Definitions:

Credit Balance

A situation where the amount of credits in an account exceeds the debits, often indicating the amount owed to the account holder.

Consolidated Expenses

Consolidated expenses refer to the aggregation of all expenses from every division or subsidiary of a corporation into a single expenses figure.

Common Stock

Shares of ownership in a corporation that entitle holders to vote on corporate matters and receive dividends.

Acquisition

The process of obtaining control of another company or business, either through direct purchase, merger, or all-stock transaction.