The primary objective of offering a cash discount is to:
A)reduce the investment in receivables.
B)reduce the number of bad checks received from customers.
C)encourage customers to place their orders prior to the peak selling period.
D)None of the above

Question

Quizplus · Accepted Answer

Offering a cash discount encourages customers to pay their bills earlier, thereby reducing the investment in receivables. This results in a faster turnaround of cash, improved cash flow, and reduced credit risk.

The Primary Objective of Offering a Cash Discount Is To