An increase in which one of the following is most apt to be an indicator of a trade receivables policy that is too restrictive?
A)Bad debts
B)Trade receivables turnover rate
C)Trade receivables period
D)Credit sales
E)Operating cycle

Question

Quizplus · Accepted Answer

A higher trade receivables turnover rate indicates that a company is collecting its receivables more quickly. If the policy is too restrictive, fewer customers may be allowed to purchase on credit, leading to faster collections and a higher turnover rate.

An Increase in Which One of the Following Is Most