If a company would like to reduce their average collection period, they can either offer a cash discount or increase their net terms.

Name: If a company would like to reduce their average collection period, they can either offer a cash discount or increase their net terms.
Brand: Quizplus
Rating: 4.8 (42 reviews)

Question

Quizplus · Accepted Answer

Increasing net terms would extend the time customers have to pay, which would not reduce the average collection period. Offering a cash discount encourages quicker payments, which can reduce the average collection period.

If a Company Would Like to Reduce Their Average Collection