In order to keep receivables low and receivable turnover high, companies can sell their receivables to:
A)a subsidiary.
B)a factor.
C)a receiver.
D)none of the above.

Question

Quizplus · Accepted Answer

Selling receivables to a factor (also known as factoring) can help companies maintain low receivables and high turnover. Factors act as intermediaries between the company and their customers, purchasing the unpaid invoices at a discount and collecting payment directly from the customers. This allows the company to quickly turn their receivables into cash while also reducing the risk of non-payment or late payment. Additionally, factors can provide other services such as credit checks and accounts receivable management, allowing the company to focus on other aspects of their business.

In Order to Keep Receivables Low and Receivable Turnover High