Since a tighter collection policy is very likely to reduce sales,such a change in policy should not be considered.

Question

Quizplus · Accepted Answer

While a tighter collection policy may result in a temporary reduction in sales, the long-term benefits of improved cash flow and reduced bad debts may ultimately outweigh this initial dip. Therefore, a change in collection policy should be considered based on the overall benefit to the company's financial health.

Since a Tighter Collection Policy Is Very Likely to Reduce