Drop Shipping Occurs When a Retailer Passes Customer Orders Directly

question 73

True/False

Drop shipping occurs when a retailer passes customer orders directly to a wholesaler or manufacturer,which then ships the order directly to the customer with the retailer's label on it.

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Definitions:

Payables Period

The average time it takes for a company to pay its invoices from suppliers, indicating the company's payment habits and cash flow management.

Credit Sales

Credit sales are transactions where the customer purchases goods or services on credit, agreeing to pay the supplier at a later date.

COGS

Cost of Goods Sold represents the direct costs associated with the production of the goods sold by a company.

Line of Credit

A flexible loan arrangement with a financial institution that allows a borrower to draw funds up to a specified limit at any time.