Extending credit to customers will result in which of the following additional costs?
A)Increased employer costs will be incurred to evaluate customer credit worthiness,track what each customer owes,and follow up to ensure correction.
B)Bad debt expense will result when amounts cannot be collected from customers.
C)Delayed receipt of cash may result requiring the company to take out short-term loans and incur interest costs.
D)All of the answers are acceptable.

Question

Quizplus · Accepted Answer

Extending credit to customers will result in increased costs for evaluating credit worthiness, following up on payments, and potentially incurring bad debt expenses. Additionally, delayed receipt of cash may result in the need to take out short-term loans and pay interest costs.

Extending Credit to Customers Will Result in Which of the Following