Lancaster Recycling has a history of problems with customers who do not pay their bills on time. Lancaster Recycling wants to improve its cash situation,reduce bad debts,and reduce
Credit- collection costs.The company might consider which of the following forms of pricing?
A)cash discounts
B)captive- product
C)inflation- adjusted
D)penetration
E)by- product

Question

Quizplus · Accepted Answer

Cash discounts can incentivize customers to pay their bills on time, improving Lancaster Recycling's cash situation and reducing bad debts. This can also help to reduce credit-collection costs, as the company may be able to avoid having to pursue late payments through collections agencies or other methods. Captive-product pricing would not be applicable in this situation, as Lancaster Recycling does not offer a product that is unique or necessary in its customers' operations. Inflation-adjusted pricing may be useful in some cases, but it would not directly address the company's issues with bad debt and cash flow. Penetration pricing focuses on offering low initial prices to attract new customers, which is not relevant to the issue at hand. By-product pricing involves selling secondary or incidental products created during the recycling process, which is not relevant to Lancaster Recycling's primary concerns.

Lancaster Recycling Has a History of Problems with Customers Who