Factoring accounts receivable is relatively an expensive source of secured short-term funds that allows firms to turn accounts receivable immediately into cash.

Question

Quizplus · Accepted Answer

Factoring accounts receivable typically involves fees and interest charges, making it a relatively expensive source of funds compared to other forms of financing. However, it is still a viable option for companies that need to quickly access cash and do not qualify for traditional bank loans.

Factoring Accounts Receivable Is Relatively an Expensive Source of Secured