An increase in accounts receivable turnover due to an increase in collection efforts will decrease a firm’s marginal investment in accounts receivable. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Accounts receivable due over 90 days total ________. (See Table 14.6) A) $200,000 B) $470,000 C) $300,000 D) $100,000 ANSWER C
Date: September 19th, 2020
A decrease in collection efforts will result in an increase in sales volume, an increase in the investment in accounts receivable, an increase in bad debt expenses, and a decrease in collection expenditures. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
An evaluation of the firm’s collection efforts based on the aging schedule would suggest ________. (See Table 14.6) A) poor credit management B) satisfactory credit management C) superior credit management D) overzealous collection efforts ANSWER A
Date: September 19th, 2020
Increased collection expenditures should reduce the investment in accounts receivable and bad debt expenses, increasing profits. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
An increase in collection efforts by a firm will result in ________ in sales volume, ________ in the investment in accounts receivable, ________ in bad debt expenses, and ________ in collection expenditures. A) an increase; a decrease; an increase; a decrease B) an increase; a decrease; a decrease; an increase C) an increase; a decrease; […]
Date: September 19th, 2020
An aging schedule breaks down accounts receivable into groups on the basis of the first letter of the name of the company that owes on the account. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
A firm’s credit terms cover ________. A) credit standards B) lines of credit C) cash discount period D) credit scoring ANSWER C
Date: September 19th, 2020
The most stringent step in the collection process is ________. A) letters B) personal visits C) collection agencies D) legal action ANSWER D
Date: September 19th, 2020
The first step in the collection of overdue accounts is ________. A) a letter B) contacting a collection agency C) legal actions D) a personal visit ANSWER A
Date: September 19th, 2020
