Factoring arrangements
A) are ways to accelerate receivable collections.
B) involve no commissions or service charges because the factor is guaranteed collections on the due date.
C) are generally used by businesses that are insolvent.
D) are mainly used in the textile and furniture industries.

Question

Quizplus · Accepted Answer

Factoring arrangements are financial transactions where a business sells its accounts receivable to a third party (factor) to accelerate cash flow and improve liquidity.

Factoring Arrangements