If a company's average collection period is higher than the industry average, then the company might be:
A) enforcing credit conditions upon its customers which are too stringent.
B) allowing its customers too much time to pay their bills.
C) too tough in collecting its accounts.
D) too liquid.

Question

Quizplus · Accepted Answer

If a company's average collection period is higher than the industry average, it means that the company is taking longer to collect payments from its customers. This could be because the company is allowing its customers too much time to pay their bills.

If a Company's Average Collection Period Is Higher Than the Industry