Which of the following is true if a firm wishes to collect its accounts faster by imposing stricter credit terms on its customers?
A) The firm's average collection period is likely to fall.
B) The firm's accounts receivable turnover might rise.
C) The firm's sales might decrease.
D) all of the above

Question

Quizplus · Accepted Answer

Imposing stricter credit terms can lead to a shorter average collection period, higher accounts receivable turnover (as receivables are collected more quickly), and potentially lower sales due to the stricter credit conditions deterring some customers.

Which of the Following Is True If a Firm Wishes