Factoring involves the sale of accounts receivable by the firm that originally generated the receivables.

Name: Factoring involves the sale of accounts receivable by the firm that originally generated the receivables.
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Factoring is a financing method used by companies to convert their accounts receivable into cash by selling them to a third party at a discount. This is done to improve cash flow and reduce the risk of bad debt.

Factoring Involves the Sale of Accounts Receivable by the Firm