When a business pledges its accounts receivable,it transfers the right to collect cash from customers to the bank.

Name: When a business pledges its accounts receivable,it transfers the right to collect cash from customers to the bank.
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Question

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When a business pledges its accounts receivable, it uses them as collateral for a loan but retains the right to collect cash from customers; the bank only gets involved if the business defaults on the loan.

When a Business Pledges Its Accounts Receivable,it Transfers the Right